Nine months ago, German Karmann declared bankruptcy. The maker of the venerable Ghia, and until recently contract manufacturer and specialist for ragtops, fell victim to the sad fact that Fahrvergnügen doesn’t agree with carmageddon.
Now, Volkswagen, one of Karmann’s main customers, picked up the core pieces of the maker. Volkswagen isn’t taking over Karmann (that would mean assuming the liabilities.) Volkswagen is buying assets: Plants, machinery, real estate. Production in Osnabrück will go on. At a much smaller scale than before.
The deal is seen as a “Thank you” note by Volkswagen for Christian Wulff, Premier of Lower Saxony, member of the Volkswagen supervisory board, and master of the 20 percent of Volkswagen stock. It was Wulff who assisted Piech in turning the table on upstart Wiedeking. Instead of Volkswagen being taken over by Porsche, Porsche was taken over by Volkswagen. Wulff’s hometown is Osnabrück. A day after the Volkswagen board officially approved the merger with Porsche, “Wulff received the Karmann-rescue he had wanted,” writes the Wirtschaftswoche.
It was a cheap gift. VW is thought to pay €30m for the assets, a mere flyspeck on VW’s €26b investment program for the next three years. Volkswagen will launch a new subsidiary for Karmann and will resume production in 2011. It plans to employ 1000 people in 2014, maybe, way down from the former 7000 who in a former time had built ragtops for richies.