Future of VW
April 24, 2008
Supporters and opponents of a much-discussed Porsche takeover of Volkswagen exchanged heated words Thursday in the northern port city of Hamburg over proposed changes to how Europe's biggest carmaker is run.
The discussion on amending VW by-laws was marked by fierce argument both in and out of a conference centre where around 2,600 shareholders gathered.
A few dozen meters yards away, several hundred VW workers brought in by the IG Metall trade union heard works committee head Bernd Osterloh denounce "the dreams of omnipotence" of Porsche boss Wendelin Wiedeking and "the arrogance of an absolute monarch."
A 54-year-old electrician at the main VW plant in Wolfsburg said "Porsche wants to split the group up and sell parts of it like Audi," the high-end auto brand owned by VW.
"Our fathers, our grandfathers worked for VW and contributed to its success," he said.
Dirk, a 35-year-old mechanic who gave only his first name, said: "VW is only here because we, the workers are here, not the managers."
State role
Inside the center, the debate focused on the VW Law setting out how the company has been organised and run since 1960 but which was ruled illegal in October by a European Union court.
The VW Law effectively guarantees the state of Lower Saxony, where the company is based and which owns just over 20 percent of its shares, a veto over strategic decisions such as plant
relocations. A normal minority blocking share in German companies is 25 percent.
Porsche, which owns more than 31 percent and wants to take a majority stake, is seeking to amend the statutes so that it will have a freer hand with VW but this is opposed by Lower Saxony and IG Metall.
The federal German government meanwhile wants to come up with a new law that addresses faults identified by the EU court while maintaining Lower Saxony's leverage in the automaker, which employs more than 300,000 people worldwide.
German Chancellor Angela Merkel was expected to discuss the situation with Lower Saxony regional premier Christian Wulff Thursday if the general assembly did not last too long, government sources told AFP.
Differing views
Throughout the day, speakers at the podium and shareholders in the halls or at buffet tables were quick to express their views.
"Porsche is right (to seek control)," said one woman who with her husband has owned VW shares for more than 30 years. "It would be better than if a foreign company took over VW," she
said.
Beate Roehrs, 44 and a Volkswagen shareholder for a dozen years, saw things differently.
"Porsche has always been a luxury brand and VW, like its name says, is a people's car," Roehrs told AFP. "It would make me sick to my stomach if Porsche bought VW."
Reassuring words
Porsche legal expert Konrad Wartenberg told shareholders late in the day that "certain brands will not be sold," mentioning Audi and the Spanish unit Seat by name.
"We do not foresee any job cuts at VW," he added.
In addition, Porsche had offered Lower Saxony "all kinds of solutions to ensure by contract the existence of VW sites in Germany." But Wartenberg held firm on scrapping the VW Law, saying that the company "had a right to become a normal enterprise."
VW directors welcomed the growing participation of the smaller but powerful Porsche in the much larger car maker's capital although VW boss Martin Winterkorn acknowledged that "a few obstacles" remained.
On Wednesday, a meeting of the VW supervisory board had failed to come up with a compromise solution to present to shareholders, company sources said.