Porsche boss quits

PORSCHE chairman and CEO Wendelin Wiedeking today fell on his sword and resigned from the company, clearing the way for Porsche to be absorbed into Volkswagen.

The controversial Mr Wiedeking, whose audacious attempt to take 75 per cent control of VW collapsed in the credit crunch under the weight of Porsche’s €9 billion ($A15.6b) debt, will collect a golden parachute of €50 million ($A87m) on his way out the door.

He will be replaced by Porsche’s production and logistics board member, Michael Macht, 48, who will now begin the task of negotiating the new arrangements with VW, which plans an “integrated” automotive company with each brand being run autonomously.

The announcements came after extraordinary meetings of the Porsche and VW boards in Germany, at which the future shape of both companies was put on the line.

Mr Wiedeking, 56, had opposed selling Porsche to VW, but VW supervisory board chairman and part-owner of Porsche, Ferdinand Piech, won the long-running battle and, in doing so, turned the tables on Mr Wiedeking.

Left: Porsche CEO Michael Macht. Below: VW's Martin Winterkorn.

Porsche is now set to become one of 10 automotive brands in the VW stable, along with Audi, Skoda, Bugatti, SEAT, Bentley, VW Commercial and Lamborghini.

The meeting also paved the way for the Middle-Eastern state of Qatar to take a slice of VW, boosting the coffers of the company as it restructures. The board endorsed a move to finalise the Qatar deal.

The resignation of Mr Wiedeking brings the curtain down on a flamboyant 16 years at Porsche.

Returning to the sportscar-maker in 1992 after making a personal fortune in the parts industry, Mr Wiedeking proceeded to turn the Porsche basket case into one of Europe’s success stories.

In doing so, he also added measurably to his wealth, becoming Germany’s highest-paid CEO – a title that also earned him plenty of scorn.

Although VW is 16 times bigger than Porsche, Mr Wiedeking led a bold bid to buy up 75 per cent of the fellow German automotive company, but only got to 51 per cent before the global financial crisis brought the deal undone.

Unable to raise more finance and re-finance existing loans among falling Porsche sales, the hunter Porsche suddenly became the hunted, with VW seeking control of the sportscar-maker.

The wrangling split the families that control the VW and Porsche empires, the Porsches and the Piechs, who variously supported VW AG’s chairman Martin Winterkorn or Mr Wiedeking.

In the end, the VW push got its way, and Mr Wiedeking was forced out, along with his deputy, Porsche finance director Holger Haerter.

A statement from Porsche said both men had come to the conclusion that “the further strategic development of Porsche SE and Porsche AG is better off if they are not on the board as acting persons”.

“They see that step (resignation) as a significant contribution to the appeasement of the situation and to support the forming of an integrated car manufacturing company,” the statement said.

Mr Winterkorn described the amalgamation of Porsche into VW as “compelling industrial logic” that would make two strong companies even stronger.

“Like Audi today, Porsche can continue its independent development under the aegis of Volkswagen and preserve its own identity,” he said.

New CEO Michael Macht, an engineer, joined Porsche in 1990 as a specialist engine planner.

In 1994, he was promoted to managing director of Porsche Consulting, and joined the board in 1998 in his current role in charge of production and logistics.

Under his guidance, Porsche opened its new Leipzig factory and brought a broader range of vehicles, including the Cayenne and Panamera, into production.

His deputy will be Thomas Edig, who has a background in human resources. He joined Porsche in 2007 as board member for human resources and labour relations.