Porsche and VW could merge soon. Currently both companies negotiate about
this option. Another one is that VW takes Porsche over. At first sight both
appear strange. After all the holding
Porsche SE is possessing over 50% of the Volkswagen stocks. So why join?
Eventually the matter is caused by two issues. First
one is the VW law.
It guarantees Lower Saxony a blocking minority, even though they just hold
a 20% share in the company, which headquarters in this state. So Porsche
cannot dispose of VW's money. That was why they brought the law to trial at
the European Court and, they even won the lawsuit. But the German government
modified that law a bit, keeping the decisive article substantially intact.
So Porsche is now forced to sue against the new version of the law and can get
the money yet. Problem was and is that they need it to repay the credits of
the VW takeover, which is the second issue in this concern. Meanwhile, recession
caused a significant decrease in car sales and revenues as well as it has made
Both means a lack of money for Porsche and make their debts a problem for them. When
both merge to one company, the debts of Porsche will be VW's debts too. This way
Porsche would get rid of the trouble. The interesting thing is how much they have
to pay to get saved. On the one hand, the Porsche family is possessing a share of more
than 50% of the new group. But Lower Saxony's goodwill won't be for free and will
require making concessions.
For Daimler and the BMW, on the other hand, a merger of VW and Porsche would worsen their situation.
They might have reputable names in their portfolios, but the numbers of produced
cars are too low to achieve synergies as Wolfsburg does. Meaning, production is
too expensive, compared to the costs of the Volkswagen Group.
That is mainly the reason why rumours came up saying Daimler and BMW will merge.
Board members of the company from Munich have now denied this, as well as a
common use of platforms and engines. Also, there will be no exchange of stocks,
as other sources reported.
Nonetheless, the German premium car makers have agreed cooperating in buying
components. Actually BMW and Daimler are financially sound the current global
economic crises however intensifies the problems they have because of their size.
Firms such as VW and Toyota may take an advantage of being beigger, especially
as alternative drives requires immense research and development efforts. Approaches
and the old rivalry of BMW and Mercedes-Benz seem still too big for a closer collaboration.
Both are still comprehending themselves
as archenemies yet.
Hard to say whether this will change or not. At the moment, situation
isn't bad enough for a fraternisation, obvioulsy. Mabye this will occur one day.
Time will tell. We, at any event, don't want these things to change!
Yes, that are unexpected developments. But they're lastly just results of the recent situation
on the car markets and the financial markets. Compared to many other countries' car makers, however,
the German industry is in good condition. All those considerations and negotiations aim at
preserving them from getting into that trou-
ble the others, expect from a few Asian companies
such as Toyota, are already in.