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Chairman Ferdinand Piech Resigns from VW


Anthony

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http://money.cnn.com/2015/04/25/news/volkswagen-chairman-resign-ferdinand-piech/index.html?category=home

 

Whoa

 

The German car maker said Saturday that Piech had resigned because an environment of trust "no longer exists" within the company's board.

 

Volkswagen has been dealing with a period of turmoil in recent weeks after Piech withdrew his support from CEO Martin Winterkorn. However, Piech failed in his bid to oust the CEO.

Edited by Intrepidatious
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So a guy who has spent the last 20 years taking his cues from Machiavelli is upset because there's a lack of trust?

He didn't get his way trying to bully Winterkorn out of his job - apparently, this is all tied to VW's lack of improvement in Nth America.

One thing is for sure, VW certainly haven't impressed in the large US market where you can basically sell anything, I mean surely

in the last few years, VW could have changed both image and strategy, done something different to break up the boringly

predictable quality issues that plague VW buyers since forever...

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I meant the US market. They are still most known for Beetles, Hippie vans, "Herbie, Love Bug", and teen girl's HS Grad presents.

 

They still haven't brought out an affordable SUV, still thinking VW is 'premium' and trying to sell the expensive, hard to pronounce, Toureg [sp?] "Toe-rag"?

 

The 2012 Passat ad was known just for the kid playing 'Darth Vader', and not the car at all. And the Jetta/Passat is filling rental fleets, not getting the 'cool, young' import buyers. They are going straight to CPO lux cars. Better a used Audi than a cheap Jetta with plastic hubcaps, that fall off easy.

Edited by 630land
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I meant the US market. They are still most known for Beetles, Hippie vans, "Herbie, Love Bug", and teen girl's HS Grad presents.

 

They still haven't brought out an affordable SUV, still thinking VW is 'premium' and trying to sell the expensive, hard to pronounce, Toureg [sp?] "Toe-rag"?

 

The 2012 Passat ad was known just for the kid playing 'Darth Vader', and not the car at all. And the Jetta/Passat is filling rental fleets, not getting the 'cool, young' import buyers. They are going straight to CPO lux cars. Better a used Audi than a cheap Jetta with plastic hubcaps, that fall off easy.

Riding the coat tails of the premium German makes. "Look at us. We're German and all the good stuff that comes with that"

 

Not unlike Nissan riding the coat tails of Toyota and Honda. "Look at us. We're Japanese and all the good stuff that comes with that"

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VW offers manual trans Golf/Jetta wagons, with diesel option. Where are all the enthusiastic buyers?

You can't sell yourself as affordable German engineering when you can get a BMW on a dirt cheap lease.

Edited by J-150
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Daniel Schwarz, analyst at Commerzbank, viewed the news as positive for VW investors.

“Many investors perceive VW as a family trust where the interests of Piech (Mergers and

acquisitions, beating Toyota, automotive world domination) were not aligned with minority

shareholders (profitability and dividends),” Schwarz said in a research note.

 

The Phaeton is the Mercedes-matching upmarket limousine which cost fortunes to build and

sold in such small numbers that, according to Bernstein Research, lost $2.7 billion or $38,000

per car since it was launched in 2002. Investment bank Evercore ISI said VW plans to launch

the Phaeton II, at a cost of $770 million.

 

The VW brand profit margin is about 2.5 per cent compared with Toyota’s 8.6 per cent, according

to the Center for Automotive Research (CAR).

 

Investors have been worrying that Piech might add yet more brands to the current collection which

include luxury Bentley, Lamborghini supercars, Audi, Porsche, Skoda and SEAT. Piech had often

expressed admiration for Fiat Chrysler (FCA’s) sporty but dormant Alfa Romeo brand, and Ferrari.

 

Bernstein Research analyst Max Warburton said Winterkorn might have clashed with Piech because

he didn’t want to buy FCA, or any parts of it.

 

“Second, Winterkorn, recognizing VW’s poor margins and the need for higher profitability, wanted to

cull some of Piech’s more expensive and unprofitable ideas - the next Phaeton, the forthcoming new

VW 5-series rival, the next Bugatti etc. Taking away the risk of an expensive deal with FCA will surely

be welcomed by VW shareholders. Taking away expensive engineering projects would also be a positive step,”

Bernstein said in a research note.

 

VW is governed by a complicated structure which includes the Piech and Porsche families, unions,

and politicians from the state of Lower Saxony. Many investors feel that this makes decision making

slow and indecisive.

 

Warburton doesn’t see Piech’s demise leading to any sudden lurch in direction though.

“We doubt much changes in the short-term at VW. It’s hard to see sudden cuts that lift profitability in

the next year or two. We assume Winterkorn moves up to become Chairman and a new plan for VW

will be developed under the leadership of the next CEO. Who might that man be,” Warburton asked.

 

- See more at: https://socialdashboard.com/news/piech-demise-boosts-volkswagen-stock-price-promising-focus-on-profits#sthash.JFZOwW2z.dpuf

 

Good article here, explains a bit more about VW...LINK

Edited by jpd80
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That and everything they make seems to be very quirky and problematic. Of the several VW owners I know, it seems like their cars spend more time being repaired than being used. They're expensive to work on too. Even doing it yourself you end up paying big bucks for parts from Germany. Its not like the more common imports that are well supported by the aftermarket parts industry.

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They don't understand the market, or more correctly, the market doesn't understand VW.

 

Simple stuff that unfortunately escapes VW's haughty ego, "We are VW and the car we make you will like.."

 

The market understands VW very well... Americans like CUVs and VW doesn't sell any good ones. Hence the problem.

 

It's quite simple... VW sells as many cars as FCA in the US. While no one is going to say FCA is a powerhouse in passenger cars in the US, they have a huge Jeep franchise to fall back on. Meanwhile VW get's clobbered in the US in CUVs sales.

 

Consider this... 2015 YTD thru April, VW has sold more than twice as many cars as Subaru. And yet, Subaru has sold 30% more vehicles than VW. What's the difference? Subaru moved over 100k "trucks" - Forester, Outback, and XV Crosstrek... In fact, XV is outselling Impreza 3 to 1. That in a nutshell is why VW is struggling in the US.

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Some want Ford to build Focus wagons, in MI, looking at VW. They seem to think there a "large pent up demand" [claiming everyone they know wants one, but how many is that?]. Thinking Ford can bring back the 3rd shift to the Focus plant with more body styles. There is a Golf wagon, but only sold 1200 last month, hardly dust on the radar screen.

 

BMW, M-B, and Audi are selling more and more SUV/CUVs. But they aren't selling lots of their station wagons. Volvo is barely hanging on and they are known for 'Euro-wagon experts'.

 

Can post endlessly about how 'buyers should be educated to buy wagons'. But Ford is a business, not a "curator of car culture". Buyers that want cargo room, want a true SUV/CUV.

 

VW is losing in trying to be 'Euro Pure', and even if they offer an Americanized sedan, they are not doing well. Jetta/Passat are fleet queens. They stubbornly are thinking "they know best and educated buyers will come". But watch them flop around like a fish out of water.

Edited by 630land
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