Volkswagen and Porsche say that the double solution is not only temporary until the IPO, but permanently.
(Photo: imago images / Patrick Scheiber)
Dusseldorf The announced change in the management of the Volkswagen Group is viewed with skepticism among investors and in financial circles. The Wolfsburg-based car manufacturer is parting ways with CEO Herbert Diess and replacing him on September 1 with Oliver Blume, who will retain his position as Porsche CEO.
At the beginning of the week, Volkswagen preferred shares came under heavy pressure with a discount of up to 4.6 percent in a rather calm market environment. The papers of VW’s major shareholder Porsche SE fell by up to 3.7 percent at the top.
The PSE is not identical to the sports car manufacturer Porsche. The Porsche-Piëch family, which owns the company, has bundled its shares in the Volkswagen Group in the listed holding company. In the afternoon, too, the VW and Porsche stocks continued to be weaker.
“In terms of timing, the change is negative,” emphasized Daniel Schwarz, automotive analyst at US investment bank Stifel. In a few weeks, at the beginning of September, the VW group wants to decide on the partial IPO of its Stuttgart subsidiary. In this respect, consistency at the helm of Volkswagen and Porsche would have been the better decision.
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The VW Group has not found an ideal solution to the management issue because Blume will have to manage two companies in the future. A week ago, at an investor day, Porsche said that the sports car manufacturer wanted to expand its independence from the parent company as part of the IPO. A few days later, however, Blume was appointed the new CEO at Volkswagen. This double function speaks clearly against more independence for Porsche.
COO should relieve Porsche boss
After all, the VW supervisory board has seen the problem that Blume with his dual function may be at risk of being overburdened. That’s why Volkswagen will have a Chief Operating Officer (COO) for day-to-day business in the future to relieve Blume. Arno Antlitz, CFO of the Wolfsburg group, will also take on this post.
Can the Porsche boss even do justice to his new dual role?
(Photo: picture alliance/dpa)
Blume should gain further relief. So it is considered certain that he will give up a whole series of advisory and supervisory board positions that go back to his function as Porsche CEO. The car manager is currently also responsible for the production department on the Group Board. Wolfsburg insiders suspect that Blume will definitely give up this task.
Investors suspect that Blume’s double function is intended to symbolize calm and stability with a view to the planned IPO. So shortly before the IPO nobody wants to replace the Porsche boss. “Blume is the man behind the Porsche success story,” said Patrick Hummel, car analyst at the major Swiss bank UBS.
Because of his success, the VW supervisory board only saw Blume as a possible Diess successor. This is where the idea of the double function came from. With an operating return of more than 16 percent, the VW subsidiary is one of the most profitable car manufacturers in the world.
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At Volkswagen and Porsche it is pointed out that the double solution should not only apply temporarily until the IPO in the fourth quarter, but will exist permanently. Blume wants to lead Porsche in the long term. The Porsche team can rely on that, he said after his appointment as VW boss.
The double burden is quite manageable, it is said in addition in Wolfsburg and Stuttgart. There are enough examples in the history of the Volkswagen Group that the CEO can also run a brand at the same time. For example, Martin Winterkorn not only managed the Group, but also the core Volkswagen Passenger Cars brand.
More: The new VW boss Oliver Blume: The secret playmaker in the group