Sources Reveal Volkswagen Chairman Was Forced Out By Board After Secret Plot Was Revealed

None of these German companies are "real" public companies (in the sense of a US or UK public company). Although they have outside shareholders, very favorable German tax and ownership laws, keep the inbred kids of the founders in charge of stuff for way too long.

Both the Quant family who runs BMW and the Piech/Porsche family who runs the VW empire have been breathing their own air for way too long. They should change the share structure, perhaps be bought out of their control shares, and a real corporate board should be installed.

The corporate governance at those firms is poor, compared to proper US or UK public companies.

Do you mean proper like Rolls Royce, Land Rover, GM, or Chrysler? Give me a break. Porsche and BMW are doing just fine by this standards.

Interesting view, mre30. I must admit that I know nothing of German laws, tax or corporate. That said, I'd like to offer a few things to consider.

First, I don't know why ousting the Chairman has anything to do with the laws. It seems to be more a matter of opinions and politics.

Second, the independence of the US and UK boards has left both of these industries far behind the Germans, irrespective of which organizations you consider. Even VW, with all its headaches, has grown much faster than its US or UK rivals in the past 30 years. Heck, Bentley only came back to life after it fell into German hands.

Lastly, there is a substantial body of evidence supporting the superior performance of private companies over public ones. You seem to be suggesting that the German system is closer to private ownership than public systems. If that's true, perhaps it's a good thing.

So where is the German system inflicting all this pain on these companies?

Yes but with VAG's success there are clearly weakneses. This is not only the fault of Winterkorn but also of Piech and the way VAG is run.Further I believe that the larger auto companies become the more difficult it is for them to adapt to market conditions. VAG's success has been primarily in the luxury market. They have struggled with Seat, they have struggled with VW in the US for a long, long time. The Suv's that are in development for the US in 2017 are 4 years too late. There is no small compact car below the Golf that is sold in North America. Further VW still struggles with reliability issues even though there is a brand spanking new state of the art factory in Chattanooga. as smart as these folks are in Wolfsburg they have not been able to figure out what and why their competition is so much more successful in the USA. Also it appears that production costs are still too high. So Piech's argument against Winterkorn may have been well founded. Without Piech and the installment of Berthold Hueber a union guy from the board, it remains to be seen how VAG is going to be able to cut it's production costs. I have rad that this new flexible platform developed for the Golf, Jetta, lower line Audi's etc. is not a cheap a platform to make as people had predicted. It will be interesting to see if VAG continues to grow or even sell off some of the acquisitions of marquees acquired on the Piech rule. For example Bentley, Lamborghini, Bugatti were Piech's pet companies. Will Porsche continue to stay in the group when it is in direct competition with Audi platforms. Or perhaps VAG would be broken up into Porsche, Bentley, Bugatti, and Lamborghini while the otherside is Seat, Skoda, VW, and Audi.Who knows. Time will tell.