VW Group Board Supporting Winterkorn In Leadership Conflict
VW Group CEO Martin Winterkorn gained a few key supporters in the leadership conflict between he and chairman Ferdinand Piëch.
The company’s six-member supervisory board’s leadership committee met with Piëch in his office in Austria last week to declare their support, according to Autoblog, following similar actions made by Wolfgang Porsche, Volkswagen’s global works council, and the German state of Lower Saxony. The board also let it be known they may extend Winterkorn’s contract beyond 2016 and should Piëch refuse to agree to public support of the CEO they would demand Piëch’s resignation.
The leadership battle is linked to a few problems Piëch has had with Winterkorn for some time, particularly VW’s ongoing sales woes in the United States. Alongside similar problems in Brazil, overall profits taking a downturn, and competitor BMW grabbing the green-car title among the German automakers, Piëch believes the CEO lacks the vision needed to pull his company into a better place in the industry. For now, though, Piëch is holding to his part of the deal with the board.
[Photo credit: Volkswagen]
I can't argue that Winterkorn has utterly failed the US market, but given that one of Piesch's pet projects, the Phaeton, was also utterly boneheaded (and he wants to foist it on the US AGAIN!), he doesn't have a great deal of room to complain.
Mr. Piech, your machiavellian little scheme did not pay out...for now. You're losing touch. P.S. - However, watch the little badger, he's not done yet.
This is interesting to say the least. VW's US market push faltered as no product arrived to feed off of VW's momentum on the Jetta and Passat designs, and then those redesigns were left on the vine a bit too long. This is undeniably his responsibility and a huge missed opportunity. If accountability is a lesson that needs to be constantly retaught, then one could argue that he should go. On the other hand the CEO is publicly copping to this mistake and VW apparently has a pair of SUVs on the way, a lifted wagon, and a chassis architecture in place that should lend them future product advantages. Point to Winterkorn. Perhaps the product roll-out was forcibly delayed by poor timing in the MQB chassis changeover compared to the lifespan of existing product in our market. I get the impression that an automaker can't run a product for only one generation on the same chassis and be profitable, every car I can think of runs the basic design for two model generations. That right there is the most charitable supposition I can make I suppose.
Honestly, I'm not sure I 'get' why US performance even matters that much to VW. They've been printing money in China, seem to own continental Europe, and have a significant presence in other markets. Even in the US, Audi has done exceptionally well of late. The US market is weird, non-luxury US consumers are cheap (thin profits) and historically they haven't even liked what VW has to offer. As far as I can tell, making VW big in the US was more an ego trip than an actual solid business decision. I guess what I'm saying is, I don't see how Winterkorn is really a failure. Maybe MQB will his undoing, I dunno. I guess I'm just not getting something here.