Ferdinand Piëch resigns as chairman of VW Group board
Chairman of Volkswagen Group, the parent company of Porsche AG, Ferdinand Piëch has resigned from his position after publically criticising current VW Group CEO, Martin Winterkorn earlier this month.
Two weeks ago, Piëch criticised Winterkorn (the man he appointed as VW Group CEO in 2006) in an interview with Der Spiegel newspaper. Piëch commented that he was keeping himself “at a distance” from Winterkorn amid disappointment at Volkswagen AG’s performance.
While VW Group is continuing to thrive amid record profits for Porsche and Audi (the two powerhouses providing pre-tax return on sales of 18 per cent and 9.6 per cent respectively in 2014), Volkswagen AG has struggled with high manufacturing costs and low profit margins.
Coupled with a failure to crack the US market, Piëch had grown increasingly impatient with Winterkorn, pitching the group into a very public leadership contest.
Piëch, who along with the Porsche family, controls 51 per cent of VW’s shares, was often used to getting his way when it came to managerial battles however, his comments were looked on disapprovingly of cousin, Wolfgang Porsche and the Lower State of Saxony, which controls around a fifth of the voting rights on the VW board.
On Saturday, Piëch and his wife, Ursula, both resigned from their positions on Volkswagen’s supervisory board in a shock move. It is rumoured that many of Piëch’s internal backers to backtracked on their support of the 78-year-old chairman.
Wolfgang Porsche, chairman of Porsche SE, released the following statement after Piëch’s resignation on Saturday:
“We have full confidence in the board of management of Volkswagen Group and we deeply regret the developments of the last few days. We thank Ferdinand Piëch for his decades of extraordinary and highly successful service to the Volkswagen Group. Our great loyalty to the Volkswagen Group and its 600,000 employees remains unchanged and we assume our responsibility as a principal shareholder.”
With Piëch out of the picture, Winterkorn’s position as CEO now looks safe, although the 67-year-old’s contract with VW expires next year. Porsche AG chairman, Matthias Müller – a close ally of Piëch, was rumoured to replace Winterkorn however, that now looks unlikely.