PORSCHE and VOLKSWAGEN TO MERGE

[grober]

Porsche and VW are to merge announced today. Porsche and VW to merge - Latest Car News from 4Car Where does that leave OPEL I wonder.

 

[Mudster]

Porsche pulled what can only be described as the single best Financial flanking move in the history of capitalism.....with a little help of some discreet Euro laws meaning they didn't have to technically declare the fact they were buying enourmous amounts of shares in VW...and whilst at it pulling the pants down of an undisclosed amount of Hedge Funds.

They only just managed to miss a stealth takeover by accident.

When you look at the size of both of these companies only 18 months ago this is like the Co-op taking over Tesco's (on a company scale that is).

So the merger isn't a huge surprise, Porsche have become incredibly powerful.

 

[RoseTattoo]

Porsche and VW are to merge announced today. Porsche and VW to merge - Latest Car News from 4Car Where does that leave OPEL I wonder.

I believe Opel have a strong product line but need some deft repositioning in the market in order to be better appreciated. Not sure that that is Fiat but yesterday I saw some figures in one of the papers that gave Opel and Fiat about the same number of employees, approximately same number of units sold but with Opel having half the revenue of Fiat. That surprised me and there could be some explanations.
Current wisdom says that there has to be more consolidation to reduce capacity so if it is Opel and Fiat, amen.
VW and Porsche is nothing less than maneuvering on the parts of the family owners involved. I take a different view. Porsche have upset just about everybody in the financial world, not just the hedge funds. That is not just one organisation but regulators, banks and other important institutions plus they have not made friends with the State of Lower Saxony. And that is not to mention VW itself. I would suggest that Porsche need to start rebuilding fences but their track record is one of 'We don't care what you think, we will do what we want.'
The VW engineers were apparently upset when Porsche management came in and started telling them what to do. They had no experience of large, complex, company management, large scale, production engineering and the effort behind organising multiple product and research lines. At least common sense seems to have prevailed in this area.

 

[grober]

Rather a good short video piece from the BBC on supplier problems in the German car industry. These include Continental tyres would you believe.
BBC NEWS | Business World | Tough times for German auto suppliers

 

[RoseTattoo]

Rather a good short video piece from the BBC on supplier problems in the German car industry. These include Continental tyres would you believe.
BBC NEWS | Business World | Tough times for German auto suppliers

Good report.
Continental is interesting as they have been taken over by Schaeffler, a pure minnow but another family owned firm which used the highly dubious practice of buying a particular type of option on Continental shares to manage the takeover. It is the same dubious practice as Porsche used in taking over VW - ridiculous. As it happens Continental is now in trouble, as this report says, and as a result Schaeffler have had their comeuppance.

 

[hawk20]

Porsche/VW is really becoming a vast mess rather like British Leyland did. Too many takeovers,too many brands, too much badge engineering.

 

[st4]

Porsche/VW is really becoming a vast mess rather like British Leyland did. Too many takeovers,too many brands, too much badge engineering.

Not quite the same.

Porsche, VW group etc all make cars that you'd want to buy and won't fall to bits. Leyland built cars that fell to bits and most of them were turkeys.

Porsche need access, with all this CO2 cr4p thats being banded about, access to good diesel engines and VAG have some nice oil burning lumps on the go. VW are developing an affordable sports car, which porsche will want in on, that may see porsche through these troubled times.

Each badge, apart from seat, in the VAG group offers a destinct product thats different to all the others. I use seat as the bad apple as its selling a re-hashed Audi A4 as its family saloon. Skoda + good value, VW=Solid middle range dependable work horse Audi =premium presitge cars Porsche = sports cars lambo = expensive super cars.

British Leyland=different makes of rusty junk

 

[hawk20]

Not quite the same.

Porsche, VW group etc all make cars that you'd want to buy and won't fall to bits.
British Leyland=different makes of rusty junk

Same strategy problems albeit at a higher level of quality.

 

[RoseTattoo]

Same strategy problems albeit at a higher level of quality.

Agree along those lines but it seems that VW with its move upmarket is competing almost directly with Audi. Porsche, with its school run truck and saloon on the way is selling its brand to people into brand buying, might be better if they linked up with LVMH on that basis.
Leyland eventually garnered just about every sizeable British manufacturer of the time with the exception of Ford, Vauxhall and Chrysler, nee Talbot, Nee Rootes and lots of brands.
Leyland's problems were poor management and no organisation of finance. It was a hand to mouth organisation so, if there was any engineering talent, it didn't have a chance to shine through. In Germany finance has always been well organised since WW2, with interlinked and bank shareholdings. This helped to smooth out the ups and downs of the market which supported a strong R&D structure which in turn led to good engineering.
VW is well organised and has a more or less compliant union setup, albeit with some sweetheart deals which are highly inefficient. The image I high of Porsche is that it is at the pointed end of family power struggles with some autocratic individuals in the lead.

 

[RoseTattoo]

VW-Porsche sports car

This is the 1971 result of their sports car collaboration
Google-Ergebnis für http://upload.wikimedia.org/wikipedia/commons/6/6e/VW-Porsche_914_am_17.06.2007.jpg

Apparently not a success although personally I thought it had a niche.

 

[grober]

Cut and shut??

This is the 1971 result of their sports car collaboration
Google-Ergebnis für http://upload.wikimedia.org/wikipedia/commons/6/6e/VW-Porsche_914_am_17.06.2007.jpg

Apparently not a success although personally I thought it had a niche.

Not the only time that Porsche got it wrong. The 928 was really destined to be the successor to the ageing 911. Perhaps with an eye to the AMERICAN market with a V8 Water cooled engine in the front ( future frontal collision performance maybe?) it proved to too big/too unwieldy for the European and American markets and the 911 retained a loyal following. Sadly I predict the same fate for the new PANAMERICA Porsche Panamera: More Info - Worldcarfans which undoubtedly is a beautifully engineered car but falls between 2 stools- being neither a luxury saloon or a sports coupe with 4 seats. Dare I say also that with reference to say to the Mercedes CLS, ( love it or loath it ) it never looks like the badly executed "cut and shut job" the PANAMERICA resembles from some angles!!

 

[Dieselman]

Not quite the same.

Each badge, apart from seat, in the VAG group offers a destinct product thats different to all the others. I use seat as the bad apple as its selling a re-hashed Audi A4 as its family saloon. Skoda + good value, VW=Solid middle range dependable work horse Audi =premium presitge cars Porsche = sports cars lambo = expensive super cars.

British Leyland=different makes of rusty junk

A good summary. Each VAG brand has a distinct identity and market placing so are not just the same cars in drag.

Audi = upper end German power-luxury (slightly debatable)
VW = Average slightly upmarket.
Seat = Sporty models.
Skoda = Less prestige but great value. The new Superb challenges this though due to being better than the Passat or A4.

A Friend with a top end passat was given a Superb as a loaner when the Passat broke down. Immediately he was rather pee'd off at being given a Skoda. When the Passat was fixed he didn't want to give the Skoda back, he said it was 'Brilliant'.

 

[Mr E]

Merger talks are now suspended - Porsche's $8 billion debt raised to by VW shares has put things onto rockier ground, especially as there was no full disclosure from Porsche about the size of debt incurred.

VW have said that they will not risk the company by taking on corporate debt of that value.

 

[MrT]

I heard the Porsche debt was in the region of €9billion. But then VW group have €10billion in cash that Porsche are hoping to access to pay off the debts.

And LOL @ VW being slightly upmarket. It's a German Ford FFS.

 

[Nik_Endeavour]

I heard the Porsche debt was in the region of €9billion. But then VW group have €10billion in cash that Porsche are hoping to access to pay off the debts.

And LOL @ VW being slightly upmarket. It's a German Ford FFS.

If only Ford made cars as durable as the Germans.

 

[wemorgan]

If only Ford made cars as durable as the Germans.

I thought Ford Europe was significantly based in Germany and certainly many of their suppliers are eg. Visteon, who used to be a Ford company.

 

[RoseTattoo]

I thought Ford Europe was significantly based in Germany and certainly many of their suppliers are eg. Visteon, who used to be a Ford company.

There are a number of unflattering jokes in Germany about how Ford cars are put together. Not suitable for the forum though.
By the way what is the Ford equivalent of the Phaeton, the new coupe or the Scirocco?

 

[wemorgan]

There are a number of unflattering jokes in Germany about how Ford cars are put together. Not suitable for the forum though.
By the way what is the Ford equivalent of the Phaeton, the new coupe or the Scirocco?

There are a number of unflattering jokes in Germany about how MB cars rust. Not suitable for the forum though.

Ford don't offer a range as wide as VW, but they're wise not to, as I doubt a Phaeton competitor would make money for Ford.

The Focus RS is meant to be a cracking car by all accounts and the new Fiesta and Mondeo also get very good reviews. I think the Ford range offers very good value for money.

 

[RoseTattoo]

There are a number of unflattering jokes in Germany about how MB cars rust. Not suitable for the forum though.

I think the Ford range offers very good value for money.

I agree and if Mrs Tattoo hadn't been so adamant I would have taken a look at a Mondeo when I changed my car this year. Next year she changes hers and I would also suggest that she looks at a Polo, Focus or maybe a Skoda before blindly changing her B Class for a new A class. The diesel in the B is awful and so she will get a petrol this time.

 

[wemorgan]

BBC NEWS | Business | VW agrees Porsche merger details