Autoblog

Volkswagen says it could conclude takeover of Porsche this year

Jonathon Ramsey — Wed, 25 Jan 2012 18:01:00 EST

Filed under: Porsche, Volkswagen, Earnings/Financials

It's been a whole three weeks since we checked in with Volkswagen's takeoever of Porsche, and the most recent news wasn't so good: investors filed a $2.6 billion suit against Porsche over the Stuttgart maker's attempt to gobble up VW. Those same investors also filed an arbitration application against Volkswagen. That hasn't stopped a VW executive from saying that its ownership of Porsche could finally be concluded this year, according to a report in Der Spiegel.

VW had earlier predicted the deal would be done last year, then released a statement in September saying that that too many hurdles and unknowns remained concerning investigations and economic ramfications for the deal to get done in 2011. The hurdles centered around previous lawsuits, including one brought by American investors in 2010, and the fact that VW couldn't evaluate Porsche appropriately until they were settled.

However, the latest upbeat report on overcoming the obstructions to getting a deal done this year don't mention those lawsuits. Instead, the resolved issues are a one-billion-euro tax payment that VW can avoid by creating a holding company by 2014 to control the Porsche stake, and VW's agreeing to contractually assure Porsche retains control over its models and where it spends its money. According to that unnamed executive, this opens the door for VW to sponge up the final 50.1 percent of Porsche it doesn't own, for a price of €3.9 billion - about $5.1B USD - but we have no idea how or why the lawsuits aren't mentioned as a factor.

In the meantime, Reuters reports that VW and Porsche are working "at arm's length" even though they have the same CEO and CFO and are busy developing cars together, a fact which is testing CEO Martin Winterkorn's patience. Earlier this month, Winterkorn was quoted as saying he wants to bring the companies closer "without needing to have a lawyer stand next to a Porsche employee every time he screws something into a Volkswagen or vice-versa."

Volkswagen says it could conclude takeover of Porsche this year originally appeared on Autoblog on Wed, 25 Jan 2012 18:01:00 EST. Please see our terms for use of feeds.

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Investment groups file $2.6B suit against Porsche over VW takeover bid

Chris Shunk — Tue, 03 Jan 2012 17:44:00 EST

Filed under: Europe, Government/Legal, Porsche, Volkswagen, Earnings/Financials

The Volkswagen takeover of Porsche may look like a slam-dunk, but a group of investment funds is hoping to change that. Bloomberg reports that the investment group has filed a lawsuit in Stuttgart, Germany, seeking $2.6 billion in damages. The group's issue traces back several years earlier to when Porsche attempted to take over the infinitely larger VW.

The group said in a statement that Porsche "gained control over the price of VW common stock as it secretly built enormous derivative positions covering almost all of VW's freely traded shares, then triggered a massive short squeeze, and finally released billions of euros worth of shares into the short squeeze for its own profit."

The group's version of the VW takeover story is similar to the one we heard about in a 2010 lawsuit, but Porsche apparently denies the accusations. Porsche spokesperson Frank Gaube has reportedly said the automaker will need to receive the suit before it could be closely examined. Bloomberg says that the investment group has also filed an arbitration application against VW.

Investment groups file $2.6B suit against Porsche over VW takeover bid originally appeared on Autoblog on Tue, 03 Jan 2012 17:44:00 EST. Please see our terms for use of feeds.

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Volkswagen and Porsche may share more technology

Chris Shunk — Tue, 11 May 2010 09:59:00 EST

Filed under: Technology, Porsche, Volkswagen

Porsche plans to grow quite a bit between now and 2015, with a goal to hit 150,000 global sales. That's about twice the German sportscar maker's 2009 totals. That sounds like a very tall order to fill, but Detlev von Platen, CEO of Porsche Cars North America, reportedly told Automotive News that the task could be accomplished with the help of Volkswagen technology. Von Platen says that a decision on future technology synergies won't be made for another six months, and added that those decisions won't be announced until a much later date. Von Platen says, "It makes sense to think about some synergies in terms of research and development, and these discussions are taking place at the moment with VW."

While we're sure that diehard Porsche fans will likely be less than pleased with the prospect of VW-infused Porsche products, the fact is that we've been living with just such an arrangement for some time. In fact, such such synergies have existed since the founding of the two companies, with the 914 (seen above) being the most well-known example of platform sharing. And, as you likely know, the Porsche Cayenne currently shares a basic platform with the more spartan Touareg, so the well-trodden path has already been laid for future sharing. Among the items that could be shared are fuel efficient powertrains and possibly even additional platforms.

But a quick glance at VW's current stable of vehicles doesn't show too many (if any) platforms that would be suitable for Porschification. One vehicle that has been rumored at Porsche is a sub-Boxster ragtop that could help the automaker boost sales while also increasing the company's overall corporate fuel economy. A VW concept that could fit nicely is the adorable little BlueSport from the 2009 Detroit Auto Show. That concept, which VW says will hit 57 miles per gallon on the Euro driving cycle, even featured a mid-engine layout; a staple of the Boxster and Cayman.

[Source: Automotive News - Sub. Req'd]

Volkswagen and Porsche may share more technology originally appeared on Autoblog on Tue, 11 May 2010 09:59:00 EST. Please see our terms for use of feeds.

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Report: Investment funds suing Porsche in U.S. for "short squeeze" fraud over VW

Jonathon Ramsey — Thu, 28 Jan 2010 10:58:00 EST

Filed under: Government/Legal, Porsche, Volkswagen, Earnings/Financials

The Porsche-as-hedge-fund escapade isn't fully resolved yet. Of course, the biggest denouement will be when Volkswagen finishes integrating the company early next year, but in the meantime, Porsche is still dealing with investor wrath after its stock market foray. A group of U.S.-based hedge funds is suing the Stuttgart carmaker for losses in excess of a billion dollars, claiming those losses came because Porsche misled them about its intent.

Porsche was coy about its stake in VW, and only disclosed its stock holdings in the company as required by German law. German law doesn't require a company to publicly declare cash-settled stock options as a share in the company. That means Porsche was sitting on shares it controlled that investors didn't know about, and investors read Porsche's statements on its intent as not having any interest in taking over VW. This, even though the company was knocking down doors all over Europe trying to get the VW law repealed...

When the extent of Porsche's holdings were found out, investors expecting VW's stock to drop had to cover their short positions buy buying a much smaller supply of stocks than expected, which drove VW's share price to intergalactic levels. And that's where the massive financial bloodletting happened. Porsche was already investigated and cleared by German authorities, who found that the company didn't break any disclosure laws. Redress in an American court, where the lawsuit was filed, could be just as difficult to come by.

[Source: Automotive News - sub. req'd | Image: Basheertome - C.C. License 2.0]

Report: Investment funds suing Porsche in U.S. for "short squeeze" fraud over VW originally appeared on Autoblog on Thu, 28 Jan 2010 10:58:00 EST. Please see our terms for use of feeds.

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Volkswagen takes 49.9 percent stake in Porsche AG

Jonathon Ramsey — Tue, 08 Dec 2009 09:32:00 EST

Filed under: Porsche, Volkswagen

Cue Ennio Morricone and the symphonic accompaniment to the endgame: VW has officially taken a 49.9% stake in Porsche. VW paid €3.9 billion ($5.75B U.S.) for its cut, "based on the enterprise value for Porsche AG calculated under a careful due diligence and valuation procedure." That's a few shades more than the €3.3 billion amount VW was saying it would pay a few months ago.

In acquiring Porsche, VW not only gains a premium brand that is still among the most profitable in the business, but VW expects its operating profit to jump by €700 million ($1.03B U.S.) over time due to cost-saving synergies. The purchase won't be finalized until 2011, though, when VW will incorporate Porsche Holding Salzburg, Europe's largest car dealer which also happens to be owned by Porsche.

You can read VW's press release - which has an air of something from Napoleon's PR department after the Battle of Austerlitz - after the jump.

[Source: Volkswagen]

Continue reading Volkswagen takes 49.9 percent stake in Porsche AG

Volkswagen takes 49.9 percent stake in Porsche AG originally appeared on Autoblog on Tue, 08 Dec 2009 09:32:00 EST. Please see our terms for use of feeds.

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VW-Porsche cross-pollination as Winterkorn, Pötsch join Porsche board

Sam Abuelsamid — Thu, 13 Aug 2009 18:59:00 EST

Filed under: Hirings/Firings/Layoffs, Porsche, Volkswagen

The assimilation of Porsche into the Volkswagen Group continued today as two top executives from Wolfsburg have taken up similar positions at the parent company of the sports car maker. Volkswagen CEO Dr. Martin Winterkorn will become CEO of Porsche Automobil Holding SE on September 15. He will be joined on the Porsche SE board of management by Hans Dieter Pötsch, who will serve as chief financial officer. Porsche SE is the holding company owned by the Porsche and Piech families that controls Porsche AG, the automaker.

Conversely, Michael Macht, who recently replaced Wendelin Wiedeking as CEO of Porsche AG, will be appointed to a senior management position at Volkswagen where he will represent the interests of Porsche. Macht will also retain his role at Porsche AG. Hit the jump for the official press release.

[Source: Porsche]

Continue reading VW-Porsche cross-pollination as Winterkorn, Pötsch join Porsche board

VW-Porsche cross-pollination as Winterkorn, Pötsch join Porsche board originally appeared on Autoblog on Thu, 13 Aug 2009 18:59:00 EST. Please see our terms for use of feeds.

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Officially Official: Porsche CEO and CFO quit, leave the building

Jonathon Ramsey — Thu, 23 Jul 2009 09:26:00 EST

Filed under: Europe, Hirings/Firings/Layoffs, Porsche

It was really just 35 words that announced the ends of two careers at Porsche: "In the last weeks Wiedeking and Härter have come to the conclusion, that the further strategic development of Porsche SE and Porsche AG is better off, if they are not on board as acting persons." And so, effective immediately, they aren't. The man who ~~would be~~ was king, Wendelin Wiedeking, and his majordomo CFO Holge Härter, have retired from Porsche with immediate effect.

The move was said to clear the way for Porsche to merge with VW and provide some relief for Porsche's balance sheet. After the same meeting that decided Wiedeking's fate, Porsche announced that it planned to increase its capital by €5 billion (about $7.1B U.S.). That's a big chunk of change, but it's only about a third of the company's debt load, and officials didn't say whether that figure would come from banks, Qatar, or some other investor. Wiedeking's position will be filled for now by supervisory board member and former head of production Michael Macht.

For severance, Wiedeking will get half of the package recently mentioned, a still-healthy sum of €50M ($71M U.S.). He has already pledged half of that money to a charity that will assist in job creation in Germany. Härter will receive €12.5M ($17.8M). Wiedeking, of course, hasn't said anything about where he might go from here, but at only 56 and with his story, we have a feeling we'll see him in the saddle again before long.

[Source: The New York Times]

Officially Official: Porsche CEO and CFO quit, leave the building originally appeared on Autoblog on Thu, 23 Jul 2009 09:26:00 EST. Please see our terms for use of feeds.

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Did you think the VW-Porsche deal was done? Nein.

Jonathon Ramsey — Tue, 21 Jul 2009 10:59:00 EST

Filed under: Europe, Porsche, Volkswagen, Earnings/Financials

When Volkswagen and Porsche sat down at dinner to discuss which one was going to eat the other one, they forgot to invite the German tax man. After VW came to terms with Porsche to take a 49.9% stake in the Stuttgart sports car maker for €8 billion (around $11.4 billion U.S.), the parties discovered there would be a €3 billion ($4.26B) tax bill on top of that.

Adding €3B just to conclude the deal, the way it's currently structured, makes it untenable for both parties. Qatar is still in the picture, but until it's decided who would pay the tax and what they would get in return, some sources are saying the whole thing could evaporate. And if that happened, that could force Porsche to turn to one of several unsavory chapters titled "BK" in the commercial code. Neither VW nor Porsche has yet commented on the tax issue. Thanks for the tip, John!

[Source: News.com.au]

Did you think the VW-Porsche deal was done? Nein. originally appeared on Autoblog on Tue, 21 Jul 2009 10:59:00 EST. Please see our terms for use of feeds.

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REPORT: Porsche denies word that CEO Wiedeking will hand over the keys amidst deal talk

Jonathon Ramsey — Thu, 16 Jul 2009 14:29:00 EST

Filed under: Porsche, Volkswagen

This executive cycle isn't uncommon, especially in Germany: CEO displays great leadership over time, then decides to do something daring, then gets caught in a series of unfortunate events, then gets a tarnished reputation, then departs the formerly high-flying company (see also: "Schrempp" and "Pischetsrieder"). Porsche CEO Wendelin Wiedeking is hoping to avoid that last phase, and his company has been fighting back rumors that his departure is imminent.

With Porsche swimming in debt, Volkswagen allegedly making extortionate claims, and Porsche considering selling 49% of its car business to Wolfsburg, several German business papers are reporting that Wiedeking is eying the exit. Automotive News reports that a writer at the Financial Times Deutschland went so far as to report that the CEO had hired attorneys to advise him. The scenarios presented in case of an exit suggest that an interim CEO will take over until a successor is named.

The head of Porsche's labor union, though, said that the reports aren't true, and Wiedeking "is doing his job and will continue to do his job." What's more, he said that the Porsche and Piech families have not agreed to join the companies, that no decision will be made without discussions with Porsche's supervisory board, and that the 49% share that VW might take in Porsche is worth double the amount being offered. As with so many family sagas, this one is a long way from being over.

[Source: Automotive News, sub req'd | Image: Alexander Hassenstein/Getty]

REPORT: Porsche denies word that CEO Wiedeking will hand over the keys amidst deal talk originally appeared on Autoblog on Thu, 16 Jul 2009 14:29:00 EST. Please see our terms for use of feeds.

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REPORT: German union leader calls on Porsche CEO to end ego trip, merge with VW

Jonathon Ramsey — Fri, 10 Jul 2009 18:29:00 EST

Filed under: Europe, Porsche, Volkswagen, Earnings/Financials

Volkswagen labor union chief Bernd Osterloh has called out Porsche's CEO for holding up a merger between the two German automakers: "Together, one could do a whole lot of more things if [Wendelin] Wiedeking would end his ego trip." Osterloh believes Wiedeking is standing in the way of a tie-up with VW, and his repeated thrusts and parries are only making things difficult for both companies.

Osterloh further accused the Porsche head of being "part of the problem and not part of the solution," claiming that he has "absolutely no more trust in the current board of Porsche." Although Porsche and VW may benefit from coming closer together, it is also clear that Porsche needs VW more than the other way around. Should the two bickering automakers eventually manage to come to terms, however, the powerful union leader has one last barb to throw: "Wiedeking isn't running our company, and he never will."

[Source: Bloomberg | Image: David Hecker/Getty]

REPORT: German union leader calls on Porsche CEO to end ego trip, merge with VW originally appeared on Autoblog on Fri, 10 Jul 2009 18:29:00 EST. Please see our terms for use of feeds.

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Look Who's Talking Again: Porsche, VW resume negotiations

Jonathon Ramsey — Fri, 22 May 2009 08:26:00 EST

Filed under: Europe, Porsche, Volkswagen, Earnings/Financials

The way things read, Porsche might not have to get a merger deal done with Volkswagen, but it would appear to be in the carmaker's best interests if it does. The holdup seems to be Porsche - since VW still doesn't know what Porsche's financial situation is, talks broke down earlier this week. VW's labor leader, who has a seat on VW's board, has also said he doesn't want to speak to Porsche again until Porsche tells everyone what it really has in mind.

Now, though, the German corporate siblings have issued a joint statement saying, "Both companies will advance efforts toward this goal in a constructive way and in mutual agreement with all the parties concerned." Still, no one knows what that means other than a commitment to keep talking - which must count for something. In the meantime, Porsche is looking for another €1.75 billion in loans ($2.43B USD) to refinance its debt, and it is also due to receive a debt rating which could give a glimpse into what's really on the books.

[Source: Reuters]

Look Who's Talking Again: Porsche, VW resume negotiations originally appeared on Autoblog on Fri, 22 May 2009 08:26:00 EST. Please see our terms for use of feeds.

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Porsche and Piech companies to own about half of post-merger VW?

Jonathon Ramsey — Mon, 11 May 2009 10:57:00 EST

Filed under: Porsche, Volkswagen, Earnings/Financials

Porsche's merger with Volkswagen is a step back from Porsche taking outright control of VW, something the automaker has been fighting various German entities to do for over a year. The willingness to co-exist is being put down to Porsche's debt levels, which can't be easy to refinance when banks are holding on to their money like a toddler guarding his last chocolate Easter bunny.

According to reports, the ten brands comprising the conglomerate will maintain their independence and might be presided over current Audi CEO Rupert Stadler. The state of Lower Saxony - the power behind the infamous Volkswagen Law - has a 20% stake and veto power concerning VW and it is likely to get up to 25% of the new company, even though it's wary of the financial risks of the merged firm. Another investor could buy 25-35% of the company, leaving the Porsche and Piech families with the remaining 45-55%.

While Deutsche Bank and Goldman Sachs continue to play with the options, negotiations between Porsche and VW are scheduled to begin this week.

[Source: Auto News, sub req'd]

Porsche and Piech companies to own about half of post-merger VW? originally appeared on Autoblog on Mon, 11 May 2009 10:57:00 EST. Please see our terms for use of feeds.

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Porsche and VW uniting 10 brands under one roof

John Neff — Wed, 06 May 2009 16:30:00 EST

Filed under: Porsche, Volkswagen

Automotive News Europe reports today that Porsche and Volkswagen have finally cleared the way for combining their brands under a single operation. The new carmaking group would have no less than 10 brands under one roof, though the "independence of all brands and explicitly also of Porsche shall be ensured." VW will be bring its nine brands to the table, while the Porsche brand itself would be contributed by Porsche Automobil Holding SE, the separate holding company owned by members of the Porsche and Piech families.

Today's news is yet another step in Porsche's long journey to take a true controlling interest in Volkswagen. The German sportscar maker has reportedly already amassed a 51% stake in Volkswagen to date, but that's not enough of a majority in Germany to run the tables. Porsche still intends to raise its stake to 75% when economic conditions allow, but then there's Lower Saxony, Volkswagen's home state that reserves the right to veto any sweeping changes, to deal with. But at least they appear to have gotten this one thing done.

[Source: Automotive News Europe, sub. req'd | Photo by NIGEL TREBLIN/AFP/Getty]

Porsche and VW uniting 10 brands under one roof originally appeared on Autoblog on Wed, 06 May 2009 16:30:00 EST. Please see our terms for use of feeds.

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Porsche backing off from taking majority stake in VW this year

Frank Filipponio — Wed, 26 Nov 2008 15:58:00 EST

Filed under: Porsche, Volkswagen, Earnings/Financials

Looks like Porsche won't be feasting on more shares of VW for Thanksgiving. Porsche has apparently decided to postpone its move to buy a majority stake in Volkswagen due to the global economic crisis. CEO Wendelin Wiedeking said he still wants that 75% share of VW, but that it's just too difficult at the moment. It doesn't help that VW shares are trading for "economically ridiculous" prices according to Porsche finance chief Holger Haerter. Porsche shares are trading at 57.261 euros, while VW was up 12.2 percent to 286.0 euros. Porsche told us last week in L.A. that it's vulnerable to the current slump in demand and that they expect 2009 to be a slow year. Controlling Volkswagen's movements and profits could help Porsche stay in the black over the next year, but it would simply be too risky right now.

[Source: Automotive News - Sub. Req.]

Porsche backing off from taking majority stake in VW this year originally appeared on Autoblog on Wed, 26 Nov 2008 15:58:00 EST. Please see our terms for use of feeds.

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VW and Porsche can't get along, risk future tech and product plans

Jonathon Ramsey — Wed, 01 Oct 2008 09:30:00 EST

Filed under: Europe, Audi, Porsche, Volkswagen

In the land of mergers and acquisitions, there are takeovers, there are hostile takeovers, and then there are I'm Gonna Git You Sucka No Matter What takeovers. Porsche's increasingly acrimonious battle to swallow VW is becoming that third option, and the brawl might threaten the short term plans of Porsche, VW and Audi. Porsche wants access to Audi engines and electronics, but VW, which owns more than 99-percent of Audi, won't allow it.

Porsche has de facto control of VW, with a 35.1-percent share. The so-called VW Law, which allows the government of Lower Saxony ultimate veto power even though it has only a 20-percent share, has been the broadsword that both VW and Germany have been using to keep Porsche at bay. The law has been struck down at least three times by the EU Commission and a German Court, only to have politicians figure out how to rewrite it without changing the substance of it.

VW's supverisory board recently declared it would need to approve any sharing between Porsche and Audi, and at the moment, Porsche can't overrule that decision. Ferdinand Piech, the head of VW, is in a battle with the Porsche family and Wendelin Wiedeking, the CEO of Porsche, over control, and neither is expected to budge. The risk is that since no one knows how this is all going to play out, a battle of egos and punitive reactions could interrupt development of and platform sharing between - and therefore the profits of - all three manufacturers' future products and technology.

[Source: Automotive News, sub. req'd]

VW and Porsche can't get along, risk future tech and product plans originally appeared on Autoblog on Wed, 01 Oct 2008 09:30:00 EST. Please see our terms for use of feeds.

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Porsche raises stake in VW again, makes offer for Audi

John Neff — Tue, 16 Sep 2008 12:32:00 EST

Filed under: Europe, Porsche, Volkswagen

Porsche has raised its stake yet again in Volkswagen, going from a bit above 30% ownership in the German giant to a solid 35.14%. The purchase apparently gives Porsche, or rather the company that owns Porsche - Porsche Automobil Holding SE - control over VW. It released a statement today that said, "as a result of this acquisition, Volkswagen... has become a subsidiary of Porsche Automobil Holding SE." Pursuant to German securities law, Porsche also made an offer to purchase Audi at the bare minimum stock price of 487 euros per share. Though Porsche says there are no plans to separate Audi from VW, it's unlikely VW will accept the offer anyway. All of this is but a single step on Porsche's long path to securing more than 50% ownership in VW. In the meantime, VW representatives will now have a seat on Porsche Automobil Holding's employee council and supervisory board. The power struggle between these two companies will undoubtedly continue, with Porsche Chairman Wolfgang Porsche leading the charge for his company while his cousin, Ferdinand Piech, holds court for Volkswagen and the powerful labor unions that are trying to stop this takeover.

[Source: Automotive News, sub. req'd]

Porsche raises stake in VW again, makes offer for Audi originally appeared on Autoblog on Tue, 16 Sep 2008 12:32:00 EST. Please see our terms for use of feeds.

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REPORT: Porsche considering 914 revival

Noah Joseph — Thu, 11 Sep 2008 10:31:00 EST

Filed under: Convertible, Performance, Porsche, Volkswagen

Click above for a hi-res gallery of the Porsche 914

Once every 40 years or so, when the stars are aligned just right, there arises the cosmic possibility for Volkswagen and Porsche to collaborate on a small sportscar. The stars in question seem to be Porsche chairman Dr. Ferdinand Piech, a spirit of ~~takeover~~ cooperation between the two German automakers, and the input of third-party contractor Karmann. It was Dr. Piech, the same man who has been driving Porsche's takeover of the Volkswagen group, who had ushered the original Porsche 914 into reality. But when Volkswagen launches its latest concept at the LA Auto Show this November, it hopes the little Elise fighter will garner enough attention to put the project into production as soon as 2011 with versions for both VW and Porsche.

The original Porsche 914 was based largely on borrowed Volkswagen mechanicals. Karmann was also heavily involved in the 914 project, and could be tapped once again to build the new sportscar for both Volkswagen and Porsche, with the project potentially spawning an Audi R4, as well. Although some sources suggest the Porsche version could adopt the 2.7-liter flat six from the base Boxster, with Zuffenhausen admittedly considering the possibility of going back to four-cylinder engines, anything's possible. Sources point out, however, that the four-cylinder version of the 914 was the top selling model. While you consider the idea of a budget Porsche, check out the high-resolution images of original 914 images in the gallery below.

Gallery: Porsche 914

[Source: Motor Trend via PistonHeads]

REPORT: Porsche considering 914 revival originally appeared on Autoblog on Thu, 11 Sep 2008 10:31:00 EST. Please see our terms for use of feeds.

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Porsche may avoid CAFE penalty by buddying up with VW

Damon Lavrinc — Tue, 25 Mar 2008 14:32:00 EST

Filed under: Government/Legal, Porsche, Volkswagen

Porsche's forthcoming majority stake in Volkswagen has the potential to remove a CAFE-sized thorn from the automaker's side. After a failed bid in Congress to create an exemption for itself from the recently revised fuel economy standards, Porsche needed a way to increase its CAFE rating in the U.S. This might be achieved by combining Porsche and VW's emissions and fuel-economy numbers into one lump sum, thus preserving the automaker's performance heritage.

While this certainly isn't anything new - Ford does it with Mazda, despite a minority stake in the automaker, and Chrysler has done it in the past when it was part owner of Mitsubishi - Volkswagen's average in 2007 was 28.6 mpg, just over the U.S. mandated 27.5 mpg. If Porsche gets thrown into that average, it's obvious that number is going to sink, quickly. However, Volkswagen's plan for the future involves new smaller, fuel-sipping vehicles, like the up! and more diesel-powered vehicles that might bring the number back up, but maybe not enough to meet the 2020 standards of 35 mpg. Porsche execs deny that this was a deciding factor in the buyout, but considering that the gentlemen from Stuttgart have cut a few checks to the feds over the years ($5 million in 2001), we're sure the idea wasn't lost on them while making their bid.

[Source: Autoweek]

Porsche may avoid CAFE penalty by buddying up with VW originally appeared on Autoblog on Tue, 25 Mar 2008 14:32:00 EST. Please see our terms for use of feeds.

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