On the one hand, we have Porsche, the champion race car, the big-engined sports specialist available at exclusive rates. On the other hand, we have the Volkswagen Convertible, which is "popular" in the literal sense; the Beetle was the inaugural model, which is still essentially ‘a car for the masses' and whose turnover is 16 times higher than the convertible. It would have been difficult to envisage respective positions more polarized. And yet it is truly an alliance of titans, the integration of David and Goliath less than four years after the company dared to publicly make such a wish.
Yet history has not forgotten that in 1993, Porsche was in deficit and its takeover by Volkswagen seemed inevitable. Much water has flowed under the bridge since then. Porsche's smallest independent manufacturer in the world is about to become a heavyweight in the automotive sector and not without its fair share of difficulties.
The adventure begins with the merger of Porsche and Volkswagen in 2005 when the Stuttgart manufacturer acquired 20% stake in the manufacture of the Beetle. Nine months later, the turnout was already at 27.3%. During the summer of 2006, Porsche received the Berlin government's permission to acquire a blocking minority of the symbol of postwar Germany, thus gaining control of the company. In March 2007, the conquest accelerated with a rise in capital of 30.9%, which prompted the market authorities to impose a Porsche takeover.
The operation failed as the price offered was too low. Porsche seized this opportunity to adapt its legal status and its ambitions to become a European company. In October, the German law implemented to safeguard the interests of the Volkswagen group was declared illegitimate by the European Court of Justice Porsche became entitled to exercise fully its role as shareholder. However, it had to wait until March 2008 until the supervisory board of Porsche agreed to engage sufficiently in the capital of Volkswagen in order to gain an absolute majority and, thereby initiate a merger.
Tags: Volkswagen Convertible, Porsche takeover, merger of Porsche and Volkswagen
[...] Emerging countries also represent growth opportunities, both for the mass market (the Volkswagen group) and the upper niches populations as well (certain brands of Porsche and Volkswagen AG). China, for example, is one of the most promising opportunities for Volkswagen and already represents 15% of its turnover. It is poised to dethrone General Motors in its leading position in China, the second largest market globally. The development of new models should allow the company to boost its growth four times faster than its U.S. [...]
[...] Emerging markets represent an important issue: It will soon equip the distribution network and provide efficient assistance to ensure sustainability of the group's presence.Finally, the very future of the automobile must be prepared taking into account the depletion of oil resources and prepare to engage in alternative fuels such as hybrids. Several projects are already underway for the newly created group: The Roxster (little brother of the Cayenne), which shares much of its components with the Audi Q5, and the Porsche Panamera.The latter is planned for this year and will be built in Volkswagen's Wolfsburg plant. The two entities also plan to work on a hybrid engine that should be marketed later in the decade and the establishment of an electronic platform. [...]
[...] Finally, on January the union was formalized, Volkswagen was now owned by Porsche, and the luxury brand intended to raise its stakes to 75% before the end of the year. There were mixed reactions to the merger. Besides the very strong opposition from the powerful union of Volkswagen, the investment bank Morgan Stanley warned Porsche that excellence in the niche market did not necessarily guarantee success in managing a globally mass marketed car.Some lament the loss of power on the public purse but W. [...]
[...] Each of the two entities will also expand its product line without the risk of cannibalization of its natural market. Finally, the common history of both companies and the customer's image of them as trusted and quality brands are advantages that should not be overlooked. Weaknesses The weaknesses of the project are rather limited. It is however important to note that the corporate cultures of the two antagonist manufacturers may fail, as often happens, during the mergers and acquisitions. W. [...]
[...] Threats Dependence on oil and the challenge of growing energy substitutes represent threats that are also facing all stakeholders. Respect for each entity within Porsche SE, with a view to efficient multi-brand strategy, remains a challenge that must be followed. Moreover, significant differences exist even within the ruling family Piech-Porsche and are likely to affect the decisions essential for the proper functioning of the group. What can Porsche bring to Volkswagen? Porsche is proud to be the most profitable manufacturer in the world also has excellent reasons to covet a merger with Volkswagen. [...]
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