Volkswagen Rebellion Ousts Its Powerful Patriarch
Industry News
Ferdinand Piech, 78, has been ousted as the Chairman of Volkswagen in a power struggle with the man he championed as VW’s future, CEO Martin Winterkorn.  This power struggle had been brewing for some time. Piech the grandson of, Ferdinand Porshce, has long been unhappy with the strategic management of Winterkorn. In a corporate climate resembling the BBC period drama Wolf Hall, Piech was secretly plotting to remove Winterkorn and replace him with a,”puppet” CEO who would do his bidding. Volkswagen is undergoing a cost restructuring programme to make the company more profitable. Under Winterkorn VW have struggled to offer a low cost model to make inroads into the South East Asian and Latin American markets. The US market has also eluded Volkswagen under Winterkorn’s reign. This lack of performance led Piech to lobby VW board members in a secret bid to oust Winterkorn. However news of the plot leaked to Volkswagen’s top shareholder who just so happened to be the company’s workers union and this triggered the demise of Piech. VW’s powerful union demanded and convened an emergency board meeting where Piech was given an ultimatum, resign or be publicly humiliated by being dismissed. Piech chose the former option and by doing so ended a 20 year reign of “corporate terror” so to speak. It has been widely regarded that Piech has been seen as a merciless operator within VW free to dismiss and hire whomever at will and therefore free to set the strategic direction from behind the scenes. Volkswagen’s corporate structure is complex, the company’s shareholders comprises of family members and as such it operates in a consensual manner. Ferdinand Piech owns 13 percent of Volkswagen, his shares are said to worth around 1.7 billion euros. The next question for VW is who will replace Piech? It could be another Piech family member, Wolfgang Porsche, or VW could opt to install an outsider as the Chairman. Meanwhile Piech may opt to sell or remain a backroom presence, a thorn in the board room’s foot. Either way you can’t say its an end of an era at VW, even when Piech is long gone the tradition of family succession within this closed corporate structure will continue because that is the way and the culture at VW.  Ferdinand-Piech-2015
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