Ferdinand Piech needs to decide whether he’s driving a Porsche, Cayenne or a VW Touareg. The Volkswagen chairman and part owner of Porsche cannot continue to drive both. He should step down as chairman and hand VW CEO Martin Winterkorn the wheel to negotiate any merger talks between the two carmakers.
Piech’s shareholding in the Porsche holding company leaves him hopelessly conflicted. However hard he tries to balance his responsibilities, Piech is always going to be left open to accusations of double dealing and almost certainly to legal challenges by minority shareholders should a deal be struck.
While the companies can’t even agree at the moment whether they are in talks or not, what is clear is that Porsche is in a real hole after its failed takeover attempt of VW left it with a 51 percent stake but 9 billion euros in debt.
Porsche is probably right about the industrial logic for a merger, but it has been in denial about the depth of its problems and therefore the strength of its negotiating position.