Posted by: David Kiley on February 19, 2008
Ferdinand Piech, chairman of Volkswagen AG and a major shareholder in Porsche AG, VW’s largest shareholder, may think Porsche CEO Wendelin Wiedeking has become too powerful and wants to oust him, according to
German weekly magazine Der Spiegel. VW denies the report.
The German magazine also reports that Piech would like to hire
Wolfgang Reitzle, the former product development boss at BMW and
Ford Motor Co.’s Premier Auto Group, to head Porsche. Reitzle is now CEO of Linde AG, a supplier of hydrogen and other industrial gases.
Reitzle, a brilliant “product guy” who led BMW’s engineering and design efforts in the 1980s and 90s, was ousted in 1999 along with Bernd Pischetreider when BMW was suffering big losses from its acquisition of the Rover Group. Reitzle had been offered the top job at Porsche in the early 1990s, but was stopped from taking it when BMW boss Eberhard von Kuenheim wouldn’t let him out of his contract. Wiedeking got the job instead.
Piech is notoriously mercurial and impetuous. He hand-picked Pischetsrieder to succeed him as chairman of VW only to subsequently torpedo the former BMW chairman when he wouldn’t rubber-stamp Piech’s wishes and directions. Piech remains chairman of VW’s suspervisory board. And it has been Piech who has orchestrated Porsche’s (the Porsche and Piech families control the voting shares at Porsche)acquisition of a controlling interest in VW. Germany’s skimpy regulations on corporate governance have not forced Piech to step down as supervisory board chairman of VW despite all then inter-mingling of personal interests.
Many in the auto industry believe Reitzle would have been perfect to lead Porsche fifteen years ago. A man known more for his discerning taste and judgement in how cars should look and perform than for his management acumen, though, may find the modern-day Porsche a huge challenge to manage. Still, with several years running Linde behind him, he may have learned a lot.
Wiedeking has an out-sized ego, which is always a clash with Piech. But his performance as a CEO can’t be disputed. He inherited a severely damaged and money-losing Porsche and managed into the most profitable automaker, based on operating margin, in the industry. If Piech actually displaces him, he won’t be out of work long. He is extremely popular, and if it suited him, he could probably mount a successful run to be Germany’s next Chancellor.