The supervisory board of Volkswagen Group just gave approval for Porsche AG to take a majority stake in the people's automaker. Porsche currently owns 31% of Volkswagen, and this move will ultimately increase that share to 51%. The increase in ownership is estimated to cost Porsche upwards of $20 billion, although the financial deets have not yet been released. Porsche is saying that owning a majority stake in VW will not result in the two companies combining, creating a German mega-automaker of biblical proportions. Don't expect things to change overnight for either company, as transactions like these generally take months to complete, if not years.
This move wasn't unexpected, either. Porsche has slowly been increasing its interest in VW over the past several years as we reported in June 2006, April 2007 and again in June 2007. Recent announcements that Porsche may use Volkswagen diesel powerplants in its Cayenne SUV now seem even more likely, and exchanges of technology, components and production capacity between the two are likely to increase.
[Source: Detroit News]
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Reader Comments (Page 1 of 1)
SilverAero @ Mar 3rd 2008 2:20PM
Wow, thats big.
ckm @ Mar 3rd 2008 2:20PM
What happens to Lamborghini? And what about the R8 and ultra-high performance Audis? All of those compete with some of Porsche's current and future lineup....
MikeInNC @ Mar 3rd 2008 2:28PM
Maybe Porsche can make a dent in the quality control department. I really like some of VW's cars but their reliability worries me.
pmiddle5 @ Mar 3rd 2008 2:37PM
The tuning company for VW's now owns VW...I love how the world pans out.
Xcountryflyer @ Mar 3rd 2008 2:50PM
This has been expected news. I hope they straighten out VW's scattered strategy and mismanagement.
Jared @ Mar 3rd 2008 3:16PM
Xcountryflyer: I don't know why you would expect this would change the management of VW. First, Porsche already effectively controls VW. Second, the man who started VW down this crazy road was Ferdinand Piech, when he was CEO of VW. He is still chairman of the supervisory board of VW. And third, as the grandson of Ferry Porsche, Piech and his family also control Porsche.
nagmashot @ Mar 4th 2008 1:27AM
mismanagment?
you should update your knowlege befor posting such BS..
2007 Volkswagen made a record win of 6.2billion Euro ($ 9,362,000,000) ... numbers US car producer only can dream about.
Lot of the money Porsche earns comes from the win Volkswagen makes.
In 2007 Volkswagen sold 6,189,000 cars which is a big plus of 7.5%... looks like they throw Ford from 3th place global sales
garlinski @ Mar 3rd 2008 2:51PM
So.. i can trade my leased Jetta for a leade Cayman and not get hurt by changing brands???? Now that would be great! The People's Cayman!
Andrew Tanasescu @ Mar 3rd 2008 2:55PM
Wow. Cant wait to see what comes out of this...
Ricky @ Mar 3rd 2008 4:38PM
Sign me up for a VW branded 911 and price tag :) /sarcasm
blunckhouse @ Mar 3rd 2008 4:42PM
To whomever made the graphics that accompanies this post: Please turn in your copy of Photoshop. You cannot mix inner shadow & drop shadow on the same character.
Dave B @ Mar 3rd 2008 4:55PM
actually they already did. it looks like ass but what ever.
it's bright green and gets everyones attention :/ (sarcasm)
Dave @ Mar 3rd 2008 8:28PM
Does this mean that Porsche can use VW diesel sales to offset their CAFE issues?
why not the LS2LS7? @ Mar 3rd 2008 9:04PM
Remember this the next time someone pulls the "poor Porsche" argument.
Poor Porsche, they shouldn't have to deal with CO2 limits.
Poor Porsche, we can excuse their stupid SUVs because it's the only thing keeping them alive.
The have enough money to buy the largest automaker in Europe. Don't feel sorry for them.