AUTONEWS

Why do investors want Blume out of Porsche or VW?

Since September 2022, when the VW Group (Volkswagen AG) floated Porsche, which it controlled at the time, on the Frankfurt stock exchange, simultaneously announcing that Oliver Blume would take over as CEO of both companies with strong ties to each other, investors have been pressuring their respective managements to abandon the CEO-sharing strategy. 

According to Reuters, the controversial option is detrimental to both the largest German group and the sports car manufacturer, and the results support this position, which has led to renewed (and strong) pressure for a separation. Something that finally appears to be about to happen, albeit against the interests of the Piech and Porsche families.

Investors, notably the State of Lower Saxony and the Qatar Sovereign Wealth Fund, argue that, at a time of great turmoil in the Chinese, North American, and European markets, it is difficult for the same manager to have enough time to dedicate to manufacturers so different in size and product types. This doesn't even take into account the possibility that the interests of both companies may not be aligned or even contradictory, which limits Blume's options, as he is a man loyal to the Piech and Porsche families.

After three years of pressure, albeit with limited success, everything indicates that this time the VW and Porsche managements have decided to appoint a new CEO for Porsche (according to Reuters), leaving Blume at the helm of Volkswagen AG, as it is in fact the company that controls Porsche, with the Piech and Porsche families controlling the German group. 

It's worth remembering that these two families hold less than one-third of Volkswagen AG's total capital (31.9%), but control 53.3% of the voting rights, thus dominating the company. At Porsche, the VW Group holds the majority of the shares and the company, with 75.4%.

A quick analysis of the performance of both automakers reveals that both are facing problems, but Porsche's appear to be more serious than those of the Volkswagen AG brands. In the last month, VW's share price rose 6.5%, while Porsche's only rose 3%, with VW falling -4.6% in the last six months and rising 1.2% in a year, while Porsche fell -19.6% and -36%, respectively.

The search for a successor has already begun, with an announcement initially scheduled for September, but the process has been postponed. Both internal and external candidates are being considered for the position.

Blume's departure comes amid growing pressure from investors for him to devote his full attention to Volkswagen, which is facing operational and strategic challenges, Bloomberg reported.

Blume had led Porsche since 2015, when he replaced Matthias Müller, and remained in the role even after taking over as Volkswagen's leader in 2022, succeeding Herbert Diess. He began his career

His dual role generated market concern, amid US tariffs, declining profits, and declining sales in China, the company's main market.

Porsche revised its financial outlook twice for 2025, while Volkswagen continues its restructuring process.

The German automaker reduced its projections for 2025, pressured by US tariffs and restructuring expenses. In the second quarter, the company's operating profit was €3.83 billion, a 29% drop compared to the same period last year, when it had totaled €5.4 billion.

The result fell short of market expectations of €3.94 billion, according to data compiled by FactSet.

Tariffs imposed by the US cost the company €1.3 billion in the first half of the year, while restructuring provisions totaled €700 million. The combined impact of these factors was estimated at around €2 billion.

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