CEO Oliver Blume, Porsche Supervisory Board Deputy Hans Michel Piëch and Volkswagen Supervisory Board Chairman Hans Dieter Pötsch (from left) on the podium in Berlin.
(Photo: dpa)
Berlin Despite recent setbacks, Volkswagen boss Oliver Blume promises his shareholders an accelerated implementation of the electric strategy. “Our goal is to also play a leading role in the market in the world of e-mobility,” said Blume on Friday in Berlin at an extraordinary general meeting of the car manufacturer. A successful electronics business will be one of the “key value drivers” for Volkswagen in the next three years.
The shareholders’ meeting on Friday had to be convened in order to decide on the distribution of a special dividend from the Porsche IPO at the end of September to all Volkswagen shareholders. A total of 9.55 billion euros will be distributed to the shareholders: 19.06 euros will be paid out per share.
The Porsche and Piëch families, who hold the majority of voting rights in Europe’s largest car company, can count on three billion euros, which they want to invest immediately in additional ordinary shares in Porsche AG.
After taking office in early September, Blume attempted a fresh start at the car giant. In the first few weeks he had to correct the software strategy that had previously failed under his predecessor Herbert Diess. In addition, Volkswagen has lost significant market share in China. The new electric cars are selling there worse than expected.
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Blume spread new optimism at the shareholders’ meeting, especially for China. “This year we will probably double the deliveries of electric vehicles there,” said the VW boss. In the case of electric models, the competition for the Wolfsburg company had recently grown significantly. Volkswagen is not only exposed to the US manufacturer Tesla, but also has to fear new Chinese competitors such as BYD, Nio and Xpeng.
>> Read also: The friendly Mr. Blume – The VW boss does that differently than his predecessor Diess
From Blume’s point of view, the group has been able to stabilize under his leadership over the past few months. At Volkswagen there is now a “new management style based on performance, team spirit and implementation,” he said. According to company circles, his predecessor Herbert Diess had isolated himself more and more and distanced himself from his own employees. In his first few months, Blume also succeeded in pacifying the relationship with the group works council.
Blume wants to focus VW more on the capital markets
As CEO, the 54-year-old wants to also ensure a better regional equal distribution of the Group’s businesses. “We continue to work on a globally balanced presence – in Europe, China and a strong third pillar North America,” he said on Friday. This is the result of recent “geopolitical developments”.
Above all, Volkswagen wants to make itself more independent of China, where the group has sold around 40 percent of its vehicles to date. With the expansion of the North American business, Blume wants to create a balance in the coming years.
The VW boss promised his shareholders a stronger capital market orientation of the entire group. The successful IPO of Porsche serves as a model. For the other group brands, Blume therefore repeated his announcement from the beginning of October that all areas of the group should go through “virtual stock exchange plans”. These are test runs for all brands, with which possible IPOs are examined.
The shareholders should decide on the payment of the special dividend from the Porsche IPO.
(Photo: dpa)
“We control our brands and platforms using binding key figures – and at the same time promote entrepreneurship and sustainable value creation,” emphasized Blume. This is intended to permanently increase the market capitalization of the VW Group. Blume is expected to present concrete results at a capital market day in April.
Volkswagen has been suffering from its low stock market valuation for years, which was repeatedly criticized by shareholder representatives on Friday. The carmaker currently has a market capitalization of almost 80 billion euros. The much smaller subsidiary Porsche is currently creating a good ten billion euros more. The IPO of the sports car manufacturer is considered the largest IPO in Europe this year.
For the time being, Volkswagen does not want to make any more changes to the ownership structure at Porsche. “We have no intention of selling any further Porsche shares,” said VW CFO Arno Antlitz. At the end of September, the Wolfsburg-based car manufacturer sold 25 percent of Porsche shares, taking almost 20 billion euros.
>> Read here, how the Porsche share could develop
About half of this goes to the shareholders as a special dividend, the rest stays within the group. Volkswagen wants to use its share to finance the transformation towards electromobility and digitization. “Batteries and software are becoming the key differentiator in the automotive industry,” said Antlitz.
Criticism of dual roles at Volkswagen and Porsche
Ingo Speich, Head of Sustainability and Corporate Governance at Deka Investments, criticized the IPO on Friday. “The IPO of Porsche AG was a flop for the VW shareholders. values have been destroyed. The price-earnings ratio of VW shares has fallen from six at the time of the IPO to currently 4.2,” said Speich.
There was also criticism of Blume’s dual role as CEO of Volkswagen and Porsche. “After four months I can say: It works,” replied Blume. The protective community of investors, on the other hand, warned of conflicts of interest. Blume cannot handle two full-time jobs at two publicly traded companies.
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