Volkswagen Gearing Up For Battle Over CEO Position
Disparaging remarks uttered by Volkswagen chairman Ferdinand Piech have led to speculation that the legendary auto exec is positioning himself to oust VW’s current CEO, Martin Winterkorn, a one-time ally of Piech who has overseen substantial growth during his tenure.
Under Winterkorn’s leadership, VW Group’s sales and profits have both increased dramatically, and the automotive conglomerate is positioning itself to be the world’s #1 auto maker. But Winterkorn has also come under fire for VW’s continued struggles in the United States (particlarly with the Volkswagen brand itself) and the slow progress of a low-cost car for emerging markets.
In remarks to German media, Piech says that he has “distanced himself” from Winterkorn, a cryptic comment that echoes his past remarks that have led to the undoing of the careers of past VW executives. But this time, Winterkorn has the support of both the German government and VW’s organized labor union. Together, these comprise roughly a substantial bloc on the 20 seat supervisory board, while the Porsche family, which traditionally aligns with the Peich-controlled seats, has thrown its support behind Winterkorn.
More by Derek Kreindler
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The image of Winterkorn on the projector looks like he was drawn by the animation team that did the "Cloudy with a Chance of Meatballs" films. I didn't know that Mr. Lockwood had a brother in the automotive industry.
Just read an interview with Ferdinand Dudenhoeffer, a professor at a German university with a auto-focused centre. His take on the situation is that Winterkorn's key failure is not fixing the core VW brand (their huge losses are covered up by success of Audi, Skoda et al.) Biggest issues are lack of clear market positioning, large manufacturing inefficiencies vis-a-vis Toyota and GM, and inflexibility from being highly vertically-integrated on components esp. in high-cost Germany. As far as Winterkorn's support from Porsche family, it's only one member and rest of family will eventually line up as usual behind Piech. So Winterkorn will slowly but very surely be squeezed out, it's just a matter of time. Of course, Mr Piech isn't young any more so he also has the issue of time….
Piech is a stubborn old geezer. His clock is ticking quickly at age 77. Winterkorn, while not perfect, has lorded over unprecedented growth for VW. The fact that NO ONE has backed Piech is indicating to me that HIS time is up, not Winterkorn's. I think this is going to lead to Piech's ouster, not Winterkorn's. At the very least, this is going to be interesting.
Best book written by a German if you want to understand their mentality: Martin Wehrle - "Ich arbeite in einem Irrenhaus“ - I work in a lunatic asylum - first published in 2011, already at 14th edition! Ferdinand Piech is at a stage in his life where he will make an excellent case study.