Porsche takes control at VW

Some tail. Some dog.

It wasn’t really that long ago – the start of the ’90s, in fact – that Porsche was in trouble. For a decade, it had been living on a con; a tweak here and there to the 911 proclaimed as massive innovation; ditto for the junior 944/968. Of genuinely new models there was no sign. Yet prices had kept going up and in North America, Porsche’s most valuable market, customers finally cried enough. Sales slumped. Enough for a major management change; enough for Ferdinand Piech, the granite-faced controlling shareholder in Porsche, to bring in chainsaw-wielding Wendelin Wiedeking as chief executive.

We know the rest: Boxster, the 996 revolution, the triumph of Cayenne for Porsche’s finances if not its aesthetics, the Cayman and, soon, the Panamera. Porsche has become the world’s most profitable car maker despite its 100,000 a year output being, by global industry standards, remarkably small.

And now, incredibly, Porsche is the controlling shareholder in Europe’s biggest cars and trucks group, Volkswagen, with a stake of 31 per cent. A tail with $8bn in sales seems poised to wag VW’s $200bn dog. But Ferdinand Piech is also VW’s chairman. What’s going on?

Those in the camp of the richly paid Wiedeking – he gets close to $35m a year – suggest that he has earned the right and manoeuvered himself into the position of power to at last knock back into shape the lumbering giant VW has become.

Don’t bet on it. Wiedeking might be moving to centre stage but behind the scenes, to the dismay of not a few investors, it is Piech pulling the strings. Never mind that during his time as chief exec of VW he bogged it down in over-complex model programmes and saw costs spiral up. Never mind that some of the problems Wiedeking may eventually be sent in to fix are those of Piech’s own creation.

So what happens next? Initially, it’s unlikely to be a lot. After what many claim to be the Piech-inspired shenanigans which led to former BMW chief Berndt Pischetsrieder being dumped as VW chief exec last year, new incumbent Martin Winterkorn, another Piech acolyte, is hardly likely to be pushed promptly aside. But change there eventually will be – and for performance car fans there’s a lot at stake; VW owns Audi, Bentley, Lamborghini and Bugatti; interesting bedfellows, all, for Porsche…