Porsche: The Hedge Fund that Also Made Cars...
10-25-2014, 07:36 AM
#1
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Porsche: The Hedge Fund that Also Made Cars...
I don't know if this had already been linked to here, but I found this article very interesting. I had read a similar article about the 'Short Squeeze' somewhere prior, but this gives the complete picture:
http://priceonomics.com/porsche-the-...lso-made-cars/
Slightly off-topic, but I thought readers of this forum might enjoy!
http://priceonomics.com/porsche-the-...lso-made-cars/
Slightly off-topic, but I thought readers of this forum might enjoy!
10-25-2014, 10:11 AM
#2
Pro
Interesting history. Thanks for sharing.
10-25-2014, 10:20 AM
#3
Amazing business case - a few things jumped out at me:
Wiedeking got his $122M bonus in '08 only to be canned in '09!
The Panamera was built on a VW chassis! (Phaeton?)
Piech's biography will be a best seller!
Wiedeking got his $122M bonus in '08 only to be canned in '09!
The Panamera was built on a VW chassis! (Phaeton?)
Piech's biography will be a best seller!
10-25-2014, 12:25 PM
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1. Porsche could survive only by learning from Toyota:
Then, why do we always bash Lexus in this forum? 991-owners should feel grateful to Toyota.
2. Porsche could have bought VW, not the other way around:
"To implement these radical changes at Porsche plants, he enlisted the help of Shin-Gijutsu, a Japanese consultancy made up of ex-Toyota manufacturing experts. Yoshiki Iwata, the lead consultant, recalls Porsche’s less-than-ideal conditions:
“It was appalling. ‘Where is the car factory,’ I asked myself. ‘It looks like a mover's warehouse!’ And there were no workers, just apes clambering up and down shelves.”
An extensive revamping of production methods ensued. At the consultant’s behest, Wiedeking symbolically sawed the factory's storage shelves in half; now there was 50% less shelfspace to keep all this wasteful inventory around.
Though some employees resented being ordered around by consultants who didn’t speak a lick of German, the Porsche factories improved dramatically under Wiedeking: assembly time per vehicle went from 120 hours to 72 hours, defects per vehicle shrunk 50%, the labor required to make the cars fell by 19%, and 30% less factory space was used."
“It was appalling. ‘Where is the car factory,’ I asked myself. ‘It looks like a mover's warehouse!’ And there were no workers, just apes clambering up and down shelves.”
An extensive revamping of production methods ensued. At the consultant’s behest, Wiedeking symbolically sawed the factory's storage shelves in half; now there was 50% less shelfspace to keep all this wasteful inventory around.
Though some employees resented being ordered around by consultants who didn’t speak a lick of German, the Porsche factories improved dramatically under Wiedeking: assembly time per vehicle went from 120 hours to 72 hours, defects per vehicle shrunk 50%, the labor required to make the cars fell by 19%, and 30% less factory space was used."
Then, why do we always bash Lexus in this forum? 991-owners should feel grateful to Toyota.
2. Porsche could have bought VW, not the other way around:
"Combined, Porsche had now corned 74.1% of all Volkswagen shares! Moreover, after years of denying its intent to acquire Volkswagen, it now finally stated it intended to pursue a “domination agreement” -- or 75% of the shares."
If Porsche could have bought VW, would a 991 have been different from today's car? Nah, the car itself would have been similar, I think.
Last edited by coxswain; 10-25-2014 at 12:41 PM.
10-25-2014, 12:46 PM
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10-25-2014, 03:37 PM
#8
Racer
Criminal charges against Porsche's management for misleading shareholders is just coming to trial in Germany. Don't make public comments when you are in charge . . . then do the opposite secretly within days of your public statement.
August 2014:
"A German court revived criminal charges against two former Porsche SE executives involving a failed takeover of Volkswagen AG, saying prosecutors’ findings indicate it “seems quite likely” the company hid its plan. The Stuttgart Higher Regional Court in an Aug. 18 ruling released today ordered former Chief Executive Officer Wendelin Wiedeking and ex-Chief Financial Officer Holger Haerter to stand trial on market manipulation charges."
August 2014:
"A German court revived criminal charges against two former Porsche SE executives involving a failed takeover of Volkswagen AG, saying prosecutors’ findings indicate it “seems quite likely” the company hid its plan. The Stuttgart Higher Regional Court in an Aug. 18 ruling released today ordered former Chief Executive Officer Wendelin Wiedeking and ex-Chief Financial Officer Holger Haerter to stand trial on market manipulation charges."
10-26-2014, 11:36 PM
#10
Criminal charges against Porsche's management for misleading shareholders is just coming to trial in Germany. Don't make public comments when you are in charge . . . then do the opposite secretly within days of your public statement.
August 2014:
"A German court revived criminal charges against two former Porsche SE executives involving a failed takeover of Volkswagen AG, saying prosecutors’ findings indicate it “seems quite likely” the company hid its plan. The Stuttgart Higher Regional Court in an Aug. 18 ruling released today ordered former Chief Executive Officer Wendelin Wiedeking and ex-Chief Financial Officer Holger Haerter to stand trial on market manipulation charges."
August 2014:
"A German court revived criminal charges against two former Porsche SE executives involving a failed takeover of Volkswagen AG, saying prosecutors’ findings indicate it “seems quite likely” the company hid its plan. The Stuttgart Higher Regional Court in an Aug. 18 ruling released today ordered former Chief Executive Officer Wendelin Wiedeking and ex-Chief Financial Officer Holger Haerter to stand trial on market manipulation charges."
The real villains, as usual, are the bankers. Much worse then merely not being there when you need them, they create money from nothing that Porsche (and everyone else but them) has to work to earn. Yet for this money from nothing they hold the power to destroy actual wealth building companies like Porsche.
I can't help noticing that it was the over-financialized "hedge fund with a car company attached" Porsche that lost out to Piech and VW with its low debt load and high cash reserves. Sure its still just paper currency. At least it was earned.
10-27-2014, 01:21 AM
#11
A few corrections...
I might go into further details later re: this story from my perspective. But first I want to correct two blatant errors in the text!
In the first photo (below), Ferdinand Porsche is probably the shortest guy there...not 'the tallest person in the picture' mentioned in the text! He is fifth person from the left...in between the two taller women!
And then there is these series of errors in the text below:
"For members of the Porsche family relaxing with their trust funds, exiting the management of the family business was all well and good -- but it meant that Ferdinand Piëch, Porsche’s CEO, had to find a new job. In 1975, he joined Audi, a small car brand owned by Volkswagen, as the Head of Technical Development."
When Ferdinand Piëch left Porsche in March of 1972, his job title was of 'Technical Director' of Porsche KG. He was never the CEO of Porsche. The text also gets wrong when he started at Audi. Piëch joined Audi NSU Auto Union KG at Ingolstadt after leaving Porsche in that same year (1972), with the task of 'special technical development'. He became Head of (All) Technical Development at Audi in 1974, and in the following year was appointed a board member of the company!
So you have to wonder what other errors might be in this story and not caught or verified by the editor of this publication before allowing this story to be printed! In general, it's all very interesting reading although I am quite certain that there is a lot more to the story re: the 'merger' of VW & Porsche that has not yet been made public or yet published. I am still awaiting the definitive book on the subject from a respected Porsche authority like Karl E. Ludvigsen, the author of 'Porsche: Excellence was Expected'.
If you are looking for an easy villain in this saga, Wendelin Wiedeking (last photo) fits the bill! But there are many angles, tangential stories & intrigues that are part of this sad episode in Porsche's history.
Saludos,
Eduardo
Carmel
.
In the first photo (below), Ferdinand Porsche is probably the shortest guy there...not 'the tallest person in the picture' mentioned in the text! He is fifth person from the left...in between the two taller women!
And then there is these series of errors in the text below:
"For members of the Porsche family relaxing with their trust funds, exiting the management of the family business was all well and good -- but it meant that Ferdinand Piëch, Porsche’s CEO, had to find a new job. In 1975, he joined Audi, a small car brand owned by Volkswagen, as the Head of Technical Development."
When Ferdinand Piëch left Porsche in March of 1972, his job title was of 'Technical Director' of Porsche KG. He was never the CEO of Porsche. The text also gets wrong when he started at Audi. Piëch joined Audi NSU Auto Union KG at Ingolstadt after leaving Porsche in that same year (1972), with the task of 'special technical development'. He became Head of (All) Technical Development at Audi in 1974, and in the following year was appointed a board member of the company!
So you have to wonder what other errors might be in this story and not caught or verified by the editor of this publication before allowing this story to be printed! In general, it's all very interesting reading although I am quite certain that there is a lot more to the story re: the 'merger' of VW & Porsche that has not yet been made public or yet published. I am still awaiting the definitive book on the subject from a respected Porsche authority like Karl E. Ludvigsen, the author of 'Porsche: Excellence was Expected'.
If you are looking for an easy villain in this saga, Wendelin Wiedeking (last photo) fits the bill! But there are many angles, tangential stories & intrigues that are part of this sad episode in Porsche's history.
Saludos,
Eduardo
Carmel
.
11-27-2014, 12:59 AM
#12
I don't know if this had already been linked to here, but I found this article very interesting. I had read a similar article about the 'Short Squeeze' somewhere prior, but this gives the complete picture:
http://priceonomics.com/porsche-the-...lso-made-cars/
Slightly off-topic, but I thought readers of this forum might enjoy!
http://priceonomics.com/porsche-the-...lso-made-cars/
Slightly off-topic, but I thought readers of this forum might enjoy!