VW board happy with Pischetsrieder.

[Yannis]

VW board happy with Pischetsrieder

Bernd Pischetsrieder looks set for a renewed contract as chief executive of Volkswagen after his supervisory board chairman explicitly backed him and the German carmaker's management.

Ferdinand Piëch, VW's chairman, who sparked an intense debate two months ago on the direction of the carmaker after describing Mr Pischetsrieder's future as "an open issue", on Thursday said the supervisory board was "very satisfied with management".

Asked whether Mr Pischetsrieder, whose contract expires in April 2007 and who has said he wants to carry on, would be offered a new contract, Mr Piëch said: "That is my assumption. From my viewpoint, that is how I see it today."

Mr Pischetsrieder's contract will be discussed at a board meeting on May 2, the day before what could be a fiery annual meeting for VW.

Mr Piëch's comments came as VW's supervisory board discussed at an extraordinary meeting a restructuring plan under which up to 20,000 jobs could be cut.

Two months after the plan was announced, and a year after its necessity was acknowledged, the board authorised management to begin negotiations with the IG Metall engineering union.

The discussions threaten to be long and hard-fought as VW tries to introduce measures such as a 22 per cent increase in working hours for no extra pay and the closure of some components operations.

Stephen Cheetham, analyst at Sanford Bernstein, thought it was "unlikely" that VW would meet its self-imposed deadline of wrapping up the talks before the summer break: "The negotiations with unions are likely to be messy and VW faces paralysis for several months."

Good first-quarter results next week could also slow the perceived need for restructuring, investors fear.

Plans to expand in Russia through a new assembly plant near Moscow were approved by the board, despite initial opposition from labour representatives, who make up half the members of the board.

Mr Pischetsrieder also denied that VW had plans to close its Brussels factory, echoing similar comments by Guy Verhofstadt, Belgium's prime minister.

The board meeting came as two of Germany's largest and most influential investment funds, DWS and Deka, tabled motions for the annual meeting criticising Mr Piëch.

The funds, among VW's biggest shareholders, want to vote individually on the approval of supervisory board members.

This is to express their dismay at recent events from sex and bribery scandals to opposition to Mr Pischetsrieder – all of which they, in part, blame on Mr Piëch.

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[Brookside]

Bernd Pischetsrieder, VW's chief, left, at a news conference Thursday (April 20, 2006, with Ferdinand K. Piech.
This article follows closely to Yannis' post (4/21)but adds some new info & pic.

Twist in the Intrigue at VW May Help Chief Keep His Job

FRANKFURT, April 20 — Volkswagen still churns out more cars than any other European manufacturer, but the biggest thing pouring from its headquarters in Wolfsburg these days is the smoke of political intrigue.


On Thursday, the influential chairman of Volkswagen's supervisory board, Ferdinand K. Piëch, said that he expected the embattled chief executive, Bernd Pischetsrieder, to win a contract extension.

That was a remarkable change in tone from February, when Mr. Piëch threw Mr. Pischetsrieder's future into doubt by publicly suggesting that he had lost the support of Volkswagen's employees.

The company's board adjourned a two-day meeting on Thursday without deciding on Mr. Pischetsrieder's future amid signs of furious jockeying among Volkswagen's major shareholders, Porsche and the state of Lower Saxony, and its labor representatives, who hold half of the 20 board seats.

Analysts said Mr. Pischetsrieder, 58, appeared to have shored up his position, though given the gamesmanship inside Volkswagen, they said it was too soon to conclude that he was safe. His five-year contract expires in 2007 and would normally be renewed a year in advance.
Volkswagen's infighting has riveted Germans, for whom this company is no mere corporate brand name. With its potent mix of politicians, union leaders and Mr. Piëch, the mercurial heir to the Porsche sports-car fortune, the boardroom fight has all the elements of high drama.

"This is like 'Dallas' and 'Dynasty' in Wolfsburg," said Ferdinand Dudenhöffer, director of the Center for Automotive Research in Gelsenkirchen. "No company in the world is so self-absorbed with its problems."


Behind the skirmishing over Mr. Pischetsrieder's job is a more fundamental struggle between Volkswagen and its workers: How deeply will the company cut jobs to regain its competitiveness?

Mr. Pischetsrieder and his chief deputy, Wolfgang Bernhard, have threatened to eliminate up to 20,000 blue-collar jobs in Germany. Volkswagen's powerful union, IG Metall, isrying to force them to water down those plans. By withholding its support for Mr. Pischetsrieder, analysts and a senior Volkswagen executive said, the union is seeking to extract a better deal.
The prime minister of Lower Saxony, Christian Wulff, a Volkswagen director who supports Mr. Pischetsrieder, had hoped to vote on extending his contract at the board meeting, which began Wednesday evening.But at a session of the board's four-member presidium that afternoon, Mr. Wulff agreed to defer the matter until May 2, according to the Volkswagen executive, who spoke on the condition of anonymity because of the delicacy of the labor negotiations. The other participants were Mr. Piëch and two labor representatives, Jürgen Peters and Bernd Osterloh.

"The union is saying, Why would we give up our joker card? We'd rather keep it until we reach some kind of agreement with the management," the Volkswagen executive said.

Some analysts see evidence that the union's strategy is working. Volkswagen is unlikely to shut a Golf assembly plant in Brussels, despite months of rumors that it might move the production to underused factories in Germany. The prime minister of Belgium, Guy Verhofstadt, said on Thursday that Volkswagen had assured him it would not close the factory.

"The unions would only give up the Brussels plant if Volkswagen was playing hardball with them on jobs in Germany," said Arndt Ellinghorst, an analyst at Dresdner Kleinwort Wasserstein in Frankfurt. "But Volkswagen is not playing hardball, so why should they give it up?"

Volkswagen's supervisory board discussed Mr. Pischetsrieder's plan to overhaul the company and gave him approval to begin negotiating job reductions with the workers and with IG Metall. Mr. Pischetsrieder declined to discuss numbers with reporters after the board meeting.

Mr. Piëch's motives are most difficult to plumb. In late February, he appeared to be laying the groundwork for Mr. Pischetsrieder's ouster, saying there was a possibility that all 10 of the employee and union representatives on the board might vote against extending his contract.

On Thursday, however, Mr. Piëch appeared at the news conference with the chief executive and declared, "The supervisory board and I are satisfied with the progress that the management board has made."

Asked whether Mr. Pischetsrieder's contract would be extended, Mr. Piëch said, "For my point of view today, that's the way I see it."

Analysts cautioned against taking Mr. Piëch's remarks as a definitive statement of his intent. Mr. Piëch was Mr. Pischetsrieder's predecessor as chief executive, and the two have had a tense relationship, as Mr. Pischetsrieder has disavowed some of Mr. Piëch's pet projects, like the Phaeton luxury sedan.

But Mr. Piëch has been criticized by some shareholders for undermining his chief executive. A German shareholder rights group said it would try to block a routine expression of approval of the supervisory board at the annual meeting, to single out Mr. Piëch for his actions.

Whatever Mr. Piëch's qualms, some analysts noted that it might make sense for him to stick with the status quo. "Pischetsrieder is a consensus guy," Mr. Ellinghorst said. "He is easier to influence."



Mark Landler/NewYorkTimes

[donau]

Very interesting story indeed. But as far as I know, Mr Piech has agreed to retire next year for getting 2 other Porsche employees on the VW supervisory board. So, I don't quite understand why this shareholders rights group still wants get some egg on his face.

[Imhotep Evil]

So sad what is happening.

[Brookside]

Dr. Ferdinand Piech and VW Chief Executive Bernd Pischetsrieder


Tweedy Browne Goes Gunning at VW
The New York investment firm knocked off Conrad Black. Now it's after the head of Ferdinand Piëch


Look out Germany Inc., here come the angry U.S. investors. In a development that takes globalization of investor activism to a new level, the powerful U.S. fund manager Tweedy, Browne is mounting an all-out assault on Volkswagen's highest-ranking board member. Tweedy Browne, which played a big role in toppling Conrad Black from his perch as chief executive of media giant Hollinger International (HLR ) in 2003, is now going after Volkswagen's legendary supervisory board chairman, Ferdinand Piëch.

A former VW CEO and leading member of the family that controls German auto maker Porsche (PSEPF ), Piëch wields big influence at VW since Porsche bought an 18.53% stake in the carmaker in October. That's a problem for Tweedy Browne, which worries Piëch will slow VW's much needed restructuring and use Volkswagen resources to subsidize Porsche operations.

"GO AWAY."* The U.S. investment firm also condemns Piëch's final years as VW CEO, when the groundwork was laid for VW's current poor performance. "He was a disaster for Volkswagen in the late 1990s," says Tweedy Browne Managing Director Thomas Schrager. "I want Piëch off the board. I want him to go away and enjoy his billions." Tough talk for a firm that owns less than 1% of VW's shares and that's taking on a pillar of Germany's corporate elite. Not only does Schrager want Piëch out, he also wants to block Porsche from voting in its own CEO, Wendelin Wiedeking, and its chief financial officer as VW board members. Schrager insists such a move would effectively cede control of VW management to Porsche. But stopping Piëch will be difficult: Under German corporate law, to prevail at this spring's shareholder meeting, Tweedy Browne would have to garner 75% of the voting shares present at the meeting. Even Schrager concedes that the odds of that happening are slim.

LOBBYING FOR CHANGE.* So why bother? Tweedy Browne figures that if it can gin up enough support, shareholder opinion will start to shift against Piëch and eventually thwart the sort of soft takeover of VW by Porsche that it fears. Tweedy Browne's hope: that Piëch will back off, ending the boardroom conflict and allowing VW Chief Executive Bernd Pischetsrieder to get on with cutting jobs and restructuring Europe's largest auto maker.
That, plus a united board, would help boost VW's stock price, now around $55, toward Tweedy Browne's target price of $70. Schrager would also welcome an outright takeover offer for the rest of VW by Porsche that would put a premium on VW shares.

Other U.S. institutions are still on the fence. "There's plenty to be worried about at Volkswagen," says a fund manager with a large stake. "But I wouldn't be worried about this stuff." San Diego-based Brandes Investment Partners, with about a 10% stake in VW -- by far the largest U.S. holder of VW -- declined to comment. Other investors, meanwhile, still think Piëch will back the makeover that VW so badly needs.

NOT WINNING FRIENDS.* Tweedy Browne has one ace to play: VW supervisory board member Christian Wulff, representative of the state of Lower Saxony, which owns 18.2% of the carmaker. Also highly critical of Piëch, Wulff commissioned a report by JPMorgan Chase (JPM ), which highlighted Piëch's possible conflict of interest and recommended that no Porsche executive sit on VW's board. Wulff, who was approached by Porsche's Wiedeking to resolve their differences, declined comment.

Piëch's maneuvers haven't helped. On Nov. 11 he backed the election of former union leader Horst Neumann as VW's new board member in charge of personnel. VW's five independent board members voted against Neumann, but the board's 10 labor representatives backed Piëch's choice. VW board member Gerhard Cromme, the respected head of Germany's commission on corporate governance, resigned in protest. "If Piëch has made an agreement with the unions to make fewer cuts in return for supporting him, the whole restructuring story at VW is gone," says Schrager.

Piëch isn't commenting. But Porsche's Wiedeking claims to support radical change at VW. And, clearly, so does Tweedy Browne.
Business Week 12/26/2005

[donau]

This is an interesting story to follow. Here's another article from Business week that preceded the article in the first post in this thread, i.e. some info in this one is a bit old already but it might still be worth while posting for the sake of recording how the story has evolved:

"March 02, 2006
Can VW's Pischetsrieder Survive the Florentine Putsch?
Gail Edmondson
Anyone who bet the power struggle at Volkswagen was over in January when cantankerous Supervisory Board Chairman Ferdinand Piech agreed to relinquish his post in 2007, just lost the wager. This week Piech lobbed a bombshell by telling a newspaper that he doubted the contract of VW CEO Bernd Pischetsrieder will be extended -- while Pischetsrieder stood in the media spotlight at the Geneva Auto Show. The subtext was clear: an embarrassing broadside to Pischetsrieder at a tactical moment. Yes, it's high drama again in the executive suites at VW's Wolfsburg headquarters. Expect Florentine-style plots and coups ahead as the battle of big egos plays out.

To understand the drama, one must forget about the parameters of a normal faceoff between American or British shareholders and management. The Old World power play at VW is only tangentially about the company's performance. Various protagnoists are battling for their own interests and agendas, with poor Volkswagen often taking a backseat to big egos, politics, power lust, ideology and even greed and sex. Here's what's going on:

Piech is the brilliant engineer and grandson of VW founder Ferdinand Porsche, who headed VW as CEO for a decade before moving up to chairman of the supervisory board in 2002. He now controls VW through his family's stake in Porsche, which bought 18.53% in VW in October. That move sparked investor outrage over Piech's conflict of interest and intensified an on-going power struggle in the top ranks of the company. One reason is that Piech, who saved VW once, made a slew of bad decisions in the late 1990s that punctured VW's competitiveness. He is now maneuvering to retain as much power, directly or indirectly, as he can. Anyone that gets in his way will be sacrificed.

Pischetsrieder, a former BMW executive who loves cigars and fast cars and never looks stressed, has been CEO for nearly four years but has made only halting progress in restructuring VW. The company suffers from an excess of some 30,000 workers, the highest labor costs in the industry, over-engineering, quality erosion, and poor marketing. German auto industry insiders say Pischetsrieder's key value is as corporate buffer between warring factions. "He is useful," says one. True, he has made a tentative start with cost-cutting programs, but VW's cars are only barely profitable.

In January, Pischetsrieder enraged Piech by yanking his pet project, the unsuccessful $70,000 Phaeton luxury sedan, from the US market. A vengeful Piech probably wants to oust Pischetsrieder -- hence his Machievellian missive about the contract not being renewed. Piech noted Pischetsrieder doesn't have the support of labor representatives on the board -- but Piech himself has long controlled those votes.

Ten VW labor representatives on the supervisory board will vote on Pischetsrieders' contract. They are loyal to Piech, who is trying to undercut Pischetsrieder by making him appear to be the job-cutting boogeyman to worried labor leaders. VW's labor reps have long done Piech's will. A recent sex and financial scandal has prosecutors investigating corporate slush funds used to bribe labor reps with exotic sex trips and prostitutes.

Wolfgang Bernhard, the former DaimlerChrysler Wunderkind who helped Dieter Zetsche turn around Chrysler and is now in charge of the Volkswagen brand group, is gunning to become Pischetsrieder's successor. But the able young manager is finding VW's politics like quicksand. Though Piech once dubbed Bernhard VW's dauphin, labor representatives are now seeking to discredit him as a "mere cost-cutter" lacking the stature to be CEO. Bernhard may well end up a sacrificial pawn in the battle of bigger forces. That might encourage his old friend Dieter Zetsche, now running DaimlerChrysler, to lure him back on board at Mercedes.

Wendelin Wiedeking, Chief Executive at Porsche, is the dark horse to replace Pischetsrieder as CEO. He's widely admired as the best car manager in Germany, saving a near-bankrupt Porsche in the early 1990s and creating a formidable profit powerhouse with a decade of steadily rising sales and the highest operating margins in the global auto industry. Wiedeking now sits on VW's board -- part of the January compromise to give Porsche (and hence Piech) its due supervisory influence at VW while reducing Piech's influence and conflict of interest. Wiedeking's right-hand man, CFO Holger Haerter, will be elected in May to join the VW board. Watch for an accelerated restructuring effort as Porsche's financial lieutenants take a closer look at VW's books.

Martin Winterkorn, the CEO of VW premium unit Audi, which generates the lion's share of VW's profits, would also love to be crowned group CEO. He's considered a longshot.

Christian Wulff, the prime minister of Lower Saxony, a German state which owns 18.2% of Volkswagen, sits on the VW board and claims to champion restructuring. He even lambasted Piech for his conflict of interest. But insiders say he is secretly will back Piech in a quid-pro-quo for avoiding radical job cuts in his electorate heartland. He is a wild card who tip the scales either way in a standoff between warring factions.

In the next weeks, the above players will test their alliances or forge new ones as Pischetsrieder's fate plays out. One thing is clear, Piech is still in the driver's seat. And he's playing for power with Renaissance skill and aplomb."

[Brookside]

Business Week is my favorite automobile magazine- there's probably more
real news in a single issue than the other monthly US car mags combined...I wish the subscription rate weren't so expensive.
Thanks for the article Donau...I want to re-read it again.

[donau]

Originally Posted by James

Business Week is my favorite automobile magazine- there's probably more
real news in a single issue than the other monthly US car mags combined...I wish the subscription rate weren't so expensive.
Thanks for the article Donau...I want to re-read it again.

Not a problem James. I am glad that the same story is interesting to both of us. And yes, Business Week is a great automobile magazine.

[Imhotep Evil]

Here is the Times:

Scandal leaves VW in the pits
£4.8m seems to have been blown on call girls and wild living, writes Michael Woodhead from Berlin

WORKS COUNCIL officials normally concern themselves with the problems of their mates on the production line. Have they been issued with the correct boots, for example.

Rarely do they have to undo the delicate strap of a high-heeled shoe tethered to the sleek ankle of a Brazilian call girl.



But then not everyone can work for Volkswagen.

Dallying with prostitutes, jetting your mistress first class around the world, setting up dubious business deals, ordering champagne in luxury hotels — these days this is apparently more the life of the working man’s representative in a global company, especially if it is a German one.

Quite why Klaus Volkert, head of Volkswagen’s general works council, lost faith with his working-class principles and took to the vices of an arrant capitalist is a mystery.

Maybe a dusky beauty called Adriana Barros is the reason. Of all the dozens of women involved in what Germans curtly refer to as “The Volkswagen Affair” Barros, a Brazilian television presenter, has become the most prominent. The rest were expensive call girls who charged €1,000 (£690) a night (without extras) in cities around the world. The years of jet-setting from one five-star hotel to another read like a sexual Baedeker guide.

Volkert is one of a number of senior Volkswagen figures who have been accused in a sleaze scandal that goes to the heart of the company’s boardroom. German prosecutors have spent months tracking mistresses and prostitutes through night clubs in Prague, Barcelona and Sao Paulo as well as unravelling sham companies in India and Africa allegedly set up by board members to line their own pockets.

Millions of euros, many of them from Volkswagen’s pension fund, are thought to have been misappropriated. Almost £280,000 was paid to Barros alone. One of those involved said Volkswagen had paid out £4.8m in the past decade billed as “business in the interests of the company”. All of it was spent on wild living and more women than you could fit into a fleet of Golfs.

This is a story of how the once shining example of Germany’s social market model, the jewel in the crown of the post-war economic revival — the miracle years — was found to be corrupt and degenerate.

Questions about the moral turpitude uncovered at Volkswagen are likely to be raised at the company’s annual meeting in Hamburg this week. It is the first chance disillusioned shareholders will have to demand answers from the board.

“This will be the most controversial annual meeting in the company’s history,” said Ulrich Hocker, head of the respected shareholder-protection association, the Deutsche Schutzvereinigung für Wertpapierbesitz. “The scandal of call girls and sham companies has embarrassed shareholders and damaged the name of Volkswagen. We want to be assured this kind of thing no longer goes on.”

And as if the sex scandal were not enough, a power battle has erupted in the boardroom over the future of the chairman, Bernd Pischetsrieder. Ferdinand Piech, head of the company’s supervisory board, has been trying to oust Pischetsrieder — the man he brought in to rationalise the company.

“It would be crazy to change horses in mid-stream,” said Hocker. “There’s no real replacement on the horizon. I think shareholders will want assurances that Pischetsrieder stays in the job and sees it through. This power battle of Piech’s is very stupid.”

Ever since Adolf Hitler created Volkswagen in the 1930s the company has retained the air of a monolithic giant whose internal workings were as impenetrable as those of the Kremlin.

Not that anyone, least of all leaders of the German government, wanted to inquire. The state of Lower Saxony owned a large chunk of the company. Former chancellor Gerhard Schröder was happy to use the company’s jet to fly to the Vienna opera house. An estimated 100 politicians are said to have pocketed regular sweeteners from Volkswagen. Two of them recently admitted being paid almost £250,000 each.

Volkswagen was a success and everybody wanted to leave it at that — until the late 1990s when the car industry had to face up to high costs, overcapacity and poor sales. Volkswagen’s attempts at restructuring were half-hearted whenever they met union opposition.

To his comrades on the shop floor, Volkert was one of them — a Kumpel, a mate who stood up to the management that was threatening their livelihoods.

None of them guessed that Volkert and other members of the works councils at Audi and Skoda had been nobbled by Klaus-Joachim Gebauer, Volkswagen’s personnel manager.

Gebauer claims his orders to “do what it takes” came from the boardroom, from Peter Hartz, the head of personnel. According to documents he handed over to the prosecutors, between 2001 and 2003, Gebauer spent £650,000 on prostitutes, luxury hotels and high living. All of it was apparently signed off by Hartz as expenses under the heading of “spent in the interests of the general works councils”.

Volkert, whose salary was £180,000, could not get enough of a rake’s life. He was always short of cash, said Gebauer.

On one works-council trip to Hanover, Gebauer paid more than £10,000 for call girls.

“The union members always wanted the best,” Gebauer told a German newspaper. “For more than a decade I obtained prostitutes for them, without it once being queried.”

He explained that the girls would be used as gifts to the union officials Volkert wanted to bolster: “It strengthened a man’s position of power — who would get a prostitute and who wouldn’t.”

You could call it sexual healing. And not even Hartz was immune. Gebauer recalled how Hartz and Volkert trawled through three Lisbon brothels looking for a high-class Brazilian call girl named Joselia, who Hartz had once met.

“It got so that a trip without prostitutes was unthinkable. It didn’t matter which country or which city we were in,” he said.

Volkert’s constant companion on these forays over four years was 44-year-old Brazilian beauty Adriana Barros. She was paid “pocket money” of about £10,000 a time. The cover story was that Volkswagen was sponsoring a project to help the street kids of Brazil. When the accountancy firm KPMG was called in after the scandal broke, it could find no evidence of the £276,000 paid to Barros going to any such project.

Barros denies she was a call girl. “I am not a prostitute, but have worked for Volkswagen,” she said.

This lavish debauchery was taking place at a time when unemployment in Germany had climbed to a record of more than 5m, the government was sinking under a mountain of debt and economic growth had spluttered to a halt. And the man summoned by Schröder to come up with a formula to cut unemployment in half was none other than his old friend Hartz. Under various Hartz initiatives the workless were stripped of benefits and subjected to inquisitions about their personal finances.

At Volkswagen they partied on — until the five-star Schlosshotel in Berlin blew the whistle on Gebauer. He was seen wandering drunk through the hotel lobby with a near-naked Russian girl on his arm.

Uta Felgner, the hotel’s director, said: “I had to ban him entering the hotel again.” Gebauer retorted that as he spent nearly £35,000 a year at the hotel he had a right to do as he pleased. Felgner took her complaints to Volkswagen. “It was the first anyone at Wolfsburg (Volkswagen’s headquarters) knew that Herr Gebauer was a regular guest,” she added.

The incident was the beginning of the end for Gebauer and his friends. With suspicions aroused, an investigation was launched. Six months later Gebauer was sacked — but not only for the sex scandal.

What came to light was Gebauer’s close friendship with an even more colourful high-flyer — Helmuth Schuster, head of the Skoda division. Schuster and Gebauer together — with Volkert’s involvement — are alleged to have set up a series of front companies to cream off millions of euros for themselves.

The Indian government has issued an international arrest warrant for Schuster after £1.4m disappeared. It was state start-up money for a supposed Volkswagen plant under the name of Vahishta Wahan.

Another scheme was in Angola for an assembly plant. Schuster set up a company called AnCar to assemble knock-down Skoda models shipped from Lisbon. Volkswagen discovered that Schuster’s business partner was a known fraudster and declared the investigators had found “certain irregularities” in the way the company was set up.

Nearer to home was Schuster’s own company, F-Bel, with offices in Prague’s glittering shopping mall. The office manager was a former beauty queen, Dagmar Kalaskova.

According to prosecutors, F-Bel was the front for an array of holding companies. Gebauer and Volkert appear among the registered directors. There are suspicions that Volkswagen pension funds were used as collateral for these companies.

Schuster’s lawyer said the prosecutors had not come up with a shred of evidence against his client. Schuster, though, has disappeared — he is thought to be somewhere in Prague. He often calls his former wife, Ilona Reutter, at her home in southern Germany. She refers to him as Dr Kimble.

Schuster is the son of a Hamburg salesman. He wrote a brilliant thesis for his university doctorate on social engineering and policy. But power and money led him as far from his socialist principles as it was possible to go. By day he drove a Skoda but at night he toured the hotspots of Prague in his black Lamborghini with Czech actress and Playboy model Katerina Brozova — and any other girls he and Gebauer found in night clubs.

“Mixing with these girls we lost sight of ourselves and in the end were no better than them,” said Gebauer. “It was a world that no longer had anything to do with normality. Money was no object. Women were always there, always 20 to 30 years younger.”

In the real world, Volkswagen under Pischetsrieder is fighting to become more profitable and efficient. Insiders say that his battle with Piech has been put on hold, though his long-term future remains uncertain. Doubts in shareholders’ minds gathering at the annual meeting this week will centre on Pischetsrieder’s lack of toughness. “He is a great strategist but does not have the toughness to see things through,” commented one shareholder.

The man seen as his successor is Wolfgang Bernhard, the brand group chairman, who has repositioned Volkswagen against Toyota rather than Mercedes. He is seen as a fierce cost-cutter and effective rationaliser.

The company’s image has taken a knock but many investors have kept their faith in Volkswagen. Jürgen Pieper, an analyst in Frankfurt, said: “The market has very mixed feelings about Volkswagen. Some analysts are negative but others, like myself, are bullish in the long term. I am expecting above-average returns. It is the second-best-performing carmaker in Europe and the share price has shown 100% improvement in the past 12 months. The basis is good.”


OMG million dollars/euros on call girls/mistresses/prostitutes.

[Brookside]

Oh man, I'd heard a little about this- but had no idea that it was so pervasive and out of control.
It isn't merely that Pischetsreider isn't the right man for the job, or that Dr. Piech is a power-freak...
it's as if VW is cursed with a systemic malfeasance that infects everything.