The global economic and credit crisis is hitting more than just the Big Three. On Wednesday, Porsche announced in Stuttgart it might delay taking over control of Volkswagen due to the shrinking demand for Porsche brand cars. Because of the downturn, chief executive of Porsche Wendelin Wiedeking, said it might no longer take 50 percent ownership of Volkswagen this year, due to Porsche’s share price being down 60 percent. Wiedeking described the downturn as incomprehensible.
“Signs of a severe slump in demand in the global automobile industry are highly visible,” Wiedeking said. “Porsche cannot escape this overall downward trend.” As of last month, Porsche owned 42.6 percent of Volkswagen and had options equivalent to a further 31.5 percent.
Bernd Osterloh, head of Volkswagen’s works council, has described Porsche’s acquisition of Volkswagen shares as a ‘hostile takeover.’ He stated what start as the two companies growing together is slowly becoming a hostile takeover by Porsche. Porsche still has plans to take control of Volkswagen “as quickly as possible” and is committed to owning 75 percent by the end of 2009.