Porsche's Wiedeking: We must retool VW

At Porsche's annual meeting, CEO Wendelin Wiedking said he wants to transform Volkswagen. Photo credit: NEWSCOM
STUTTGART — Porsche CEO Wendelin Wiedeking says he will push ahead in transforming Volkswagen, Europe's biggest carmaker, into a leaner, meaner rival to Toyota Motor Corp.

Wiedeking, 55, said Porsche's acquisition of a 31 percent stake in Volkswagen group has been a good investment. "We care about our investment," Wiedeking said. "We will ask further questions until we have a broad picture. That will cause resistance, but we see this as our responsibility."

He made the comments during Porsche's recent annual meeting here.

As chairman of Porsche Automobil Holding SE, the company that will control the Porsche family's stake in VW group, Wiedeking, who also sits on the VW group supervisory board, wants to have a major say in what happens at VW.

The new order

As an example of the tighter VW-Porsche relationship, Wiedeking said the body of the new Porsche Panamera four-door coupe will be produced in Hanover, Germany, and the interior and engine will be added to the coupe in Leipzig. The Hanover and Leipzig plants are VW facilities.

"This business model is successful because it saves unused production capacities, saves money regarding fixed costs, and brings money into Volkswagen's cash box," Wiedeking said.

Sharing parts and related costs for development in the future will create a solid basis for a long-term relationship and business model, Wiedeking said. For example, the strong-selling Porsche Cayenne, VW Touareg and Audi Q7 SUVs share a platform.

After taking charge of Porsche in 1993, Wiedeking turned the struggling sports car maker into the world's most a profitable car company. He copied Toyota's lean production methods to help achieve Porsche's turnaround.

Porsche has a 10 billion euro (about $14.7 billion) credit line to raise its stake in VW to a controlling 51 percent, a move that industry insiders expect to happen within the next few months.

More like Porsche?

Ferdinand Dudenhoeffer, director of the Center for Automotive Research in Gelsenkirchen, Germany, told Automotive News Europe last October that Porsche's influence will mean that VW's corporate culture will become more like Porsche's.

Financial performance will be more important. Wiedeking already has warned that there will be no "sacred cows" at Volkswagen and "no toys" in the group's product portfolio.

A potential future trouble spot is Wiedeking's relationship with IG Metall, the metal workers union that represents almost all of the workers in VW's German plants.

Wiedeking already has worried VW workers by saying the company should focus on productivity and profits.

Until now, its former biggest stakeholder, the Lower Saxony government, has protected VW workers from management efforts to trim pay or alter contract terms.

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