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New Chief at VW



Must be a Republican with close ties to Bush and Foley.  What state was
he running in? I didn't see his name on any ballot. Oh, I see, it's the 
"state of Lower Saxony".  Just below South Dakota.

Chris

julie@menloparkrandd.com wrote:
> In a sharp reversal, Volkswagen today ousted its chief executive,
> Bernd Pischetsrieder, six months after he appeared to win an internal
> power struggle by signing a new contract. Skip to next
> paragraphAndreas Rentz/Getty Images Bernd Pischetsrieder, chief
> executive of Volkswagen, was ousted.
> 
> 
> 
> Volkswagen, Europe?s largest carmaker, gave no reason for the
> decision by a select committee of its supervisory board, which voted
> to replace Mr. Pischetsrieder with Martin Winterkorn, the head of
> Volkswagen?s Audi division. The change will take effect at the end of
> the year. Analysts and industry experts said the sudden shakeup bore
> the fingerprints of Volkswagen?s influential chairman, Ferdinand K.
> Pi?ch, who had tried to maneuver Mr. Pischetsrieder out of his post
> earlier this year, saying he had lost the support of employees. Mr.
> Pischetsrieder clung to his job then, partly because of support from
> the state of Lower Saxony, one of Volkswagen?s largest shareholders.
> But analysts said the influence of Lower Saxony has waned as
> Volkswagen?s largest shareholder, Porsche, has tightened its grip. 
> ?This is another step in Porsche saying, ?we will increase our
> influence over VW,? ? said Ferdinand Dudenh?ffer, director of the
> Center for Automotive Research in Gelsenkirchen. ?Porsche and Pi?ch
> dominate the supervisory board of Volkswagen.? The announcement left
> analysts baffled since Mr. Pischetsrieder?s future had seemed secure
> in May, when Volkswagen?s board, after lengthy deliberation, extended
> his contract for five years. It throws Volkswagen back into
> management turmoil after a period of relative tranquillity. A courtly
> man with a trademark Cuban cigar, Mr. Pischetsrieder, 58, has the
> dubious distinction of having been forced out of two famous German
> carmakers: in 1999, he was dismissed as chief executive of BMW,
> following a calamitous investment in the British carmaker Rover. Mr.
> Pischetsrieder?s latest troubles began a year ago when Porsche began
> buying shares in Volkswagen. Although Porsche said it wanted to
> shield the company from an unwelcome foreign takeover, it posed a
> potential challenge to Mr. Pischetsrieder?s efforts to streamline
> Volkswagen. Porsche currently owns 21.2 percent of Volkswagen and has
> signaled its intention to raise its stake to 25.1 percent. Reports
> surfaced today that it might buy up to 29.9 percent of Volkswagen?s
> shares ? the most it can own without being legally required to make a
> takeover bid. Porsche?s interests are closely intertwined with those
> of Mr. Pi?ch. A grandson of the founder, Ferdinand Porsche, Mr. Pi?ch
> and his family control the company. He is also Mr. Pischetsrieder?s
> predecessor as chief executive of Volkswagen, with strong views as to
> how that company should be run. Last February, Mr. Pi?ch publicly
> undermined Mr. Pischetsrieder, saying it was an ?open issue? whether
> the board would extend his contract, because of opposition to him by
> unions and workers? representatives. Mr. Pischetsrieder was then
> warning about sweeping job losses. Two months later, Mr. Pi?ch
> reversed course, saying he expected the contract to be extended. The
> prime minister of Lower Saxony, Christian Wulff, had thrown his
> support behind Mr. Pischetsrieder. Some analysts believe Mr. Wulff?s
> intervention saved the embattled chief executive. Mr. Winterkorn,
> analysts said, is a prot?g? of Mr. Pi?ch?s. Both are talented
> automotive engineers with less experience in overhauling companies.
> Mr. Pischetsrieder was seeking to lower Volkswagen?s labor costs by
> cutting jobs in its German plants and renegotiating union contracts. 
> ?Pischetsrieder was trying to push through decisions that Pi?ch was
> resisting,? said Arndt Ellinghorst, an analyst at Dresdner Kleinwort.
> ?Winterkorn is someone who will always do everything that Pi?ch
> says.? Mr. Ellinghorst suggested that Porsche might be interested in
> taking over Audi, the luxury division of Volkswagen. Mr. Winterkorn
> has won praise recently in the German news media for closing the gap
> between Audi and the two prime German luxury brands, Mercedes-Benz
> and BMW. Mr. Pischetsrieder?s departure also raises questions about
> the future of his chief lieutenant, Wolfgang Bernhard. As head of
> Volkswagen?s core brand, Mr. Bernhard is responsible for carrying out
> the cost-cutting plan devised by the board. A former No. 2 executive
> at the Chrysler Group, Mr. Bernhard has been viewed as a likely
> successor to Mr. Pischetsrieder. Analysts, however, expressed some
> skepticism that Mr. Bernhard would be able to work with Mr.
> Winterkorn. Mr. Bernhard?s departure would unnerve shareholders, Mr.
> Ellinghorst said, since he is viewed as being integral to
> Volkswagen?s campaign to reduce its costs. The shakeup also has
> potential implications for Volkswagen?s role in a takeover battle
> between two European truckmakers, MAN and Scania. Volkswagen had
> acquired a stake in MAN to influence its bid for Scania, and some
> analysts said Mr. Pi?ch might push for even more central role. ?The
> market will not be scared simply by Pischetsrieder?s departure,? Mr.
> Ellinghorst said. ?But the market could be scared by the two or three
> steps that might follow from it.?
> 
> 
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