Crown

Porsche CEO Dr. Wendelin Wiedeking and Porsche CFO Holger P. Härter have resigned effective immediately and left Porsche.

17 years ago, Porsche was almost bankrupt and nobody actually thought that Porsche is going to survive and stay independent. Then, Dr. Wiedeking was appointed CEO and things started to change at Porsche.

Dr. Wiedeking introduced the Boxster and kept the 911 alive. He also started to lower production cost by learning from japanese car maker Toyota.

The press and the public loved Dr. Wiedeking: he was blunt, open minded and more important, he refused taking financial aid from the german state. This made him very popular with the public.

Although Porsche didn't always earn money with their cars per se and although some critical voices inside and outside Porsche questioned the financial games of Dr. Wiedeking and his CFO Härter, Porsche was the lovechild of stock markets worldwide for some while. The brand name Porsche was not only popular, it was standing for good quality and new technology. It was also standing for exclusivity and luxury.

The introduction of the Cayenne was late but necessary, the Cayman was pure genius from a marketing point of view but apparently the marketing department underestimated the intelligence of their customers. Instead of being successful as an entry-level 911 for people under 35, the Cayman actually became the new "entry-level" 911 for the 40-50 year olds.

Despite the extended model line, Porsche was making money with the financial "games" CFO Härter inititated and they worked out well for some while, adding some serious money to Porsche's bank accounts.

The Porsche family was happy, they earned billions of Euros over the past 17 years during Dr. Wiedeking's leadership and the stock value of Porsche was at new heights. Unfortunately there was one family member who wasn't too happy, maybe because he didn't like Dr. Wiedeking's popularity or maybe because he was actually somebody with a lot of experience in the car production business and forsaw that a car company can't survive on a longterm view without actually earning money with...cars.

It seems that it was Mr. Piech who opposed Dr. Wiedeking's and CFO Härter's plan to take over "big brother" Volkswagen. Not only because Mr. Piech was actually involved with Volkswagen but because Mr. Piech was afraid that it is a very risky thing to do for Porsche, especially since Piech is a member of the Porsche family and owns a pretty large chunk of Porsche.

The other Porsche family members apparently had more trust in Dr. Wiedeking, so they decided to go on with the Volkswagen takeover, despite the warnings from Mr. Piech. Maybe Mr. Piech was even playing a double game, hoping for a successful takeover and at the same time, just in case, be prepared ("I told you so...") if the takeover doesn't succeed. I can't imagine that Dr. Wiedeking and Mr. Härter went on with their VW takeover attempt without the consent of Mr. Piech and without his advice, even if Mr. Piech somehow opposed the takeover attempt in public.

When the economy worldwide went downhill, Dr. Wiedeking and Mr. Härter realized pretty soon that a VW takeover is not only difficult but practically impossible. 

This time, Mr. Piech had his moment. Remember? "I told you so...". The Porsche family had no other choice than to make the right decision for Porsche.

Volkswagen is going to integrate Porsche as the 10th brand, at the same time it seems that production and model line decisions will stay with Porsche. This seems to be the official story. Truth is: as soon as Dr. Wiedeking walked out, Porsche will not be the old Porsche we know anymore. Mr. Macht, the new CEO, learned a lot from Dr. Wiedeking and he also shares a good part of Dr. Wiedeking's philososphy for Porsche, no doubt about it. Unfortunately there is not only the Porsche family in his back anymore but also the Volkswagen company, including Mr. Piech. It isn't going to be easy for Mr. Macht and it is not very clear if Mr. Macht is going to be the "final" CEO or just somebody who had to replace Dr. Wiedeking on short notice.

Dr. Wiedeking was good for Porsche, no doubt about it. The Porsche family owes him a lot and they know it. This may be the reason why they let Dr. Wiedeking choose his own fate, by allowing him to resign. Luckily, it wasn't Mr. Piech who had to take the lead in this matter, otherwise things may have gotten ugly in the process.

Dr. Wiedeking gets 50 Million EUR for his good-bye and half of this sum goes to a social network for Porsche employees. This is a good thing and it proves that Dr. Wiedeking wasn't just CEO of Porsche but he also left his heart with Porsche, he WAS Porsche. 

Dr. Wiedeking is gone and although many Porsche employees are still hoping for a miraculous return, we doubt that this is going to happen. Too many people at Volkswagen opposed Dr. Wiedeking, incl. Mr. Piech and Mr. Winterkorn. 

The future of Porsche is a little bit uncertain right now. Although Porsche claims that Volkswagen is not going to get involved with production or future model development, I doubt that Volkswagen will accept a fully independent Porsche.

The game is over, Volkswagen has won. This may be a good thing for some but it is surely a bad thing for Porsche employees. Sooner or later, Porsche has to be trimmed down here and there, there is no need for a second Audi in the Volkswagen company.

Farewell, Dr. Wiedeking...Porsche owes you a lot.

Mr. "High Tech" Dr. Wiedeking

Holger P. Härter

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RC (Germany) - Rennteam Editor 997 Turbo, Cayenne Turbo S, BMW M3 Cab DKG, Mini Cooper S JCW

It will be interesting to see how this plays out with the union as they've said in print that WW must stay.

ISUK:

It will be interesting to see how this plays out with the union as they've said in print that WW must stay.

WW resigned and got a multimillion "handshake", so it's not Union matter.

Nevertheless, once he is gone they will forget about him in a week's time. "The king is dead long live the new king".

IMO WW's position was unattenable at Porsche. His and Haerter's strategy ended up in disaster. The very objective of their strategy was "independence and domination of VW" but it resulted the other way round. No matter how good he was at the beginning its the final result that counts, like in all apects of life.

--
It's not where you're going, it's how you get there that counts

I heard in the radio that half of the multimillion "handshake" will go to charity. Well done!

I don´t know if this is that good news... Just if Porsche inside VW group will turn back to more focused cars... as it used to build them at the beginning. But let´s see... 

reginos:

ISUK:

It will be interesting to see how this plays out with the union as they've said in print that WW must stay.

WW resigned and got a multimillion "handshake", so it's not Union matter.

Nevertheless, once he is gone they will forget about him in a week's time. "The king is dead long live the new king".

IMO WW's position was unattenable at Porsche. His and Haerter's strategy ended up in disaster. The very objective of their strategy was "independence and domination of VW" but it resulted the other way round. No matter how good he was at the beginning its the final result that counts, like in all apects of life.

 

I'm well aware he resigned. The Union stated in the press over the weekend that he must stay and not be pushed out by the politics being played out by the family. The fact he has been "persuaded" to resign with a healthy payout will still not please them.

ISUK:

reginos:

ISUK:

It will be interesting to see how this plays out with the union as they've said in print that WW must stay.

WW resigned and got a multimillion "handshake", so it's not Union matter.

Nevertheless, once he is gone they will forget about him in a week's time. "The king is dead long live the new king".

IMO WW's position was unattenable at Porsche. His and Haerter's strategy ended up in disaster. The very objective of their strategy was "independence and domination of VW" but it resulted the other way round. No matter how good he was at the beginning its the final result that counts, like in all apects of life.

 

 

I'm well aware he resigned. The Union stated in the press over the weekend that he must stay and not be pushed out by the politics being played out by the family. The fact he has been "persuaded" to resign with a healthy payout will still not please them.

 

I don't think they can do much about the removal of WW,as it happened.

However, I expect that the Porsche Workers Union will start getting more involved in the terms of the VW "Merger" and try to object to certain provisions of the deal.

--
It's not where you're going, it's how you get there that counts

I'm worried..don't know if is good or not...

Super Darius:

I'm worried..don't know if is good or not...

The point is that, given Porsche's huge debt (thanks to WW and Haerter) if nothing was done the company would go bankrupt. Life at Porsche couldn't continue as if nothing happened.

WW tried to find investors willing to save Porsche independently of VW but he couldn't find any. Even Qatar isn't willing to save Porsche by putting millions without getting a slice of the VW bon fillet.

Not the official Rennteam commentary (which will come from RC) but just my personal thoughts....

I think we all knew something like this was coming but the sudden announcement still managed to take my breath away.

On the one hand WW turned around the company when it was in deep financial difficulty with the creation of the life-saving Boxster and Cayenne models (in particular, the Cayenne tapped into the massive growth in demand for SUVs). WW introduced more modern production methods (learned from Toyota) to improve efficiency. His way of running PAG was focussed on improving profitability by raising quality and efficiency and by reducing costs. Some of his decisions on new models no doubt upset the purists: water-cooled engines, Cayman & Panamera etc. And then, while other car makers were suffering or making small profits, PAG made billions of Euros through non-car related financial activity.

And then the other side of the coin. A lot of this non-car related activity involved high-risk financial trading for the purposes of acquiring VW. The reason given was that this would secure the future of PAG since it was reliant upon its relationship with VW for models like the Cayenne/Toureg platform etc. BUT one cannot help but think there was more to it than this.

The attempt to obtain control over VW failed because of the severe changes in the financial markets (since Q3 2008) and also the fact that the VW law (although ruled illegal under EU law) was never abolished. WW's high risk strategy failed leaving PAG deeply in debt and which is now costing PAG its independence. And this failed power play has cost WW his position.

The departure of WW is a major development (with obvious consequences for the model range and the future direction of the company) but the loss of independence is the most significant aspect to digest. It's a landmark day in PAG's long history.

Just my personal view...

--
 

Rennteam Moderator - 997.1 C2S Coupe GT Silver/Cocoa, -20mm/LSD, PSE, SportDesign rims, Zuffenhausen collection

If any of the VAG brands start selling a rear engined, RWD/AWD, my last 911 will be the last Porsche I ever buy...

BBC article (originally posted on RT by wtsnet):

http://news.bbc.co.uk/1/hi/business/8164295.stm

Rennteam Moderator - 997.1 C2S Coupe GT Silver/Cocoa, -20mm/LSD, PSE, SportDesign rims, Zuffenhausen collection

I'm optimisitc that this could result in some welcomed changes. I didn't care for the direction WW was taking the company.

The end of the Weideking era characterized by stunning, often unexpected, success on a scale unknown to Porsche and equally stunning hubris, excess, and finally, failure. Books will be written about this Shakespearean corporate tragedy.

The guy was a hack. Late to the SUV party by 5 years. The boxster was too expensive and too close to the 911 for a true entry level car, should have been 4 cyl. like the 944 though shaped like a california spyder.

And of course letting the 928 die on the vine was a huge mistake creating the market for AM, Maserati, Audi, lambo...............

And this latest mess (wasting money on buying VW) which I criticized the first time mentioned here years back was pure stupidity.

Good Riddance!

how could I forget the FUGLY panamera disaster!

This will remain interesting. I'm still confused about how this merger/take-over will turn out. From what I have heard Porsche yesterday agreed on WW's plan to take in Quatar as an investor in order to reduce debt. Porsche repeatedly said it won't need to sell 50% of its car division to VW. VW in turn still wants to buy out Porsche, so there's still trouble ahead.

They will merge one way or the other, so I don't know what's the difference for the Porsche/Piech clan as they will roughly hold 50% of VW no matter which way they go. 

Also what the whole fiasco has shown over the last couple of months, what a power struggle is taking place within the families. Once they will own 50% of VW it will get really interesting when they move their personal problems on to a whole new level.

Also Piech is way too powerful. He's the one who's pulling all the strings within the VW group- the rest are just his puppets. Once he's gone, VW will implode, as there's no real hierarchy and when his heirs take over- good night!

Tim

Way to go.  So it will finally be true that the Porsche's from here on out will actually fit those "so you drive a VW" one liners.

Sad day and I can no longer talk sh!t talk with my Corvette buddies.  Is there any independent sports car company worth anything anymore?

harryo2b:

Way to go.  So it will finally be true that the Porsche's from here on out will actually fit those "so you drive a VW" one liners.

 

It will all depend on how the brand will be placed. Lamborghini and Bentley definitely don't carry this "stigma".

Exactly - nobody belittles the Bentley Continental GT's engine even though it is essentially the same engine as that used in the VW Phaeton W12...

--
 

Rennteam Moderator - 997.1 C2S Coupe GT Silver/Cocoa, -20mm/LSD, PSE, SportDesign rims, Zuffenhausen collection

easy_rider911:

Exactly - nobody belittles the Bentley Continental GT's engine even though it is essentially the same engine as that used in the VW Phaeton W12...

 

 Or in the Audi A8 W12, or in the new Porsche ... 

Eunice:

easy_rider911:

Exactly - nobody belittles the Bentley Continental GT's engine even though it is essentially the same engine as that used in the VW Phaeton W12...

 

 Or in the Audi A8 W12, or in the new Porsche ... 

 

Panamera GT Coupe powered by the W12 and transmission by Bugatti's twin clutch gearbox. Why not indeed

What is WW replacement (Michael Macht) background ?

Michael Macht

AGE: 48; born Aug. 28, 1960, in Stuttgart, Germany.

EDUCATION: Studied mechanical engineeering at Stuttgart University.

CAREER: Worked at the Fraunhofer Institute for Industrial Engineering IAO before joining Porsche AG in 1990 where he became a specialist in engine planning. In 1994 he was named managing director of Porsche Consulting GmbH and in 1998 was named director of production and logistics.

What an irony: his surname Macht means Power but he won't have much power

.......and the person resonsible for comercial issues and administration is a HR expert!

Porsche-Jeck:

What an irony: his surname Macht means Power but he won't have much power

 And even more irony: "Michael macht" means "Michael does"  

We'll see, maybe he earns his power, maybe not. But chances are slim as he'll only get control of one out of I-forgot-how-many VW brands.

Spyderidol:

.......and the person resonsible for comercial issues and administration is a HR expert!

They don't need a CFO anymore - the number crunchers in Wolfsburg will take care...

It's a sad day - Porsche lost its most precious asset: independency

I remember reading that Macht is WW's protege. He was the driving force in increasing efficiency and cutting costs. His biggest achievement is supposed to be the Panamera so far.

So much about going all hard-core. A cost cutter, Panamera and Cayenne lover....hahahaha.

mmmh.....

they tell Porsche will remain Porsche,indipendant,exclusive, etc.

Sure Wiedeking whant/need to make profit without compromise and to sell a lot of cars,not that is wrong but sure there would be and in fact  there is a loss of exclusivity(Cayenne V6,Diesel,etc..)maybe now we can save something(or at least some of..),so after a few ours from the fact i can't tell if is better or worse.

Hope to have more money for racing,maybe less entry level models,and more power for all...

at least this is,if i would be the Porsche CEO,what i whant to do...

Rennteamers vote me for the next change

easy_rider911:

Not the official Rennteam commentary (which will come from RC) but just my personal thoughts....

I think we all knew something like this was coming but the sudden announcement still managed to take my breath away.

On the one hand WW turned around the company when it was in deep financial difficulty with the creation of the life-saving Boxster and Cayenne models (in particular, the Cayenne tapped into the massive growth in demand for SUVs). WW introduced more modern production methods (learned from Toyota) to improve efficiency. His way of running PAG was focussed on improving profitability by raising quality and efficiency and by reducing costs. Some of his decisions on new models no doubt upset the purists: water-cooled engines, Cayman & Panamera etc. And then, while other car makers were suffering or making small profits, PAG made billions of Euros through non-car related financial activity.

And then the other side of the coin. A lot of this non-car related activity involved high-risk financial trading for the purposes of acquiring VW. The reason given was that this would secure the future of PAG since it was reliant upon its relationship with VW for models like the Cayenne/Toureg platform etc. BUT one cannot help but think there was more to it than this.

The attempt to obtain control over VW failed because of the severe changes in the financial markets (since Q3 2008) and also the fact that the VW law (although ruled illegal under EU law) was never abolished. WW's high risk strategy failed leaving PAG deeply in debt and which is now costing PAG its independence. And this failed power play has cost WW his position.

The departure of WW is a major development (with obvious consequences for the model range and the future direction of the company) but the loss of independence is the most significant aspect to digest. It's a landmark day in PAG's long history.

Just my personal view...

 

 I could not have said it better. Cheers Easy.