News: Porsche is about to face bankruptcy!

Porsche Liebhaber

Porsche Liebhaber

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I just saw this on TV @ DW-TV :(:(

Porsche refuses VW's ultimatum​
not my title!​

Germany's financially troubled sports car maker Porsche has rejected what it calls a humiliating ultimatum from rival Volkswagen, but the corporate power struggle between the two companies is anything but over.

"We won't let ourselves be blackmailed," said Porsche chairman Wolfgang Porsche in a statement on Saturday, June 27. "These are not the manners that encourage a spirit of togetherness."

According to industry sources quoted in the German magazine Der Spiegel, Volkswagen and the German state of Lower Saxony, which also owns a portion of Volkswagen, have given Porsche two days to accept the proposal for cross-ownership that would eventually lead to a merger or face bankruptcy.

"Ultimatums never achieve anything," Porsche said, calling on "the initiators" to "calm down and pursue their proposals in closed-door talks, not via headlines."

Failed attempt

Porsche is in a financial bind because it tried to engineer a takeover of Volkswagen in 2008 but failed as the global economic downturn worsened. It currently owns 51 percent of Volkswagen yet it does not have management control.

Volkswagen, the larger of the two, has proposed to take over 49.9 percent of Porsche's factories and brand for 3 to 4 billion euros, with the rest of the shares staying in Porsche's hands.

If Porsche rejects the offer, it will probably see VW demand reimbursement of a 700-million euro loan it provided Porsche in March.

Porsche - currently carrying a heavy burden of 9 billion euros ($13 billion) in debt - prefers a rescue option from the Qatari Investment Authority (QIA) in exchange for a minority stake in the sports car maker.
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Schei?e :(:(:(

http://www.dw-world.de/dw/article/0,,4437785,00.html
 
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MMmmmh. So much for "the world's most profitable automaker."

MacGuffin: You just lost the right to claim that "mismanagement like at GM can't happen to Porsche."
 
I can't say I feel sorry for Porsche. They thought they were big and clever with their play for VW last year, and now they've been pwned by the GFC.

Anyway, if VW takes over Porsche what's the worst that could happen? Another 924? Maybe a VW Golf GTI with a squashed Beetle body on top being marketed as 'The People's Porsche'?
 
They could (gasp) cancel the Panamera and Cayenne!

(No loss there, though...)
 
Spectre said:
They could (gasp) cancel the Panamera and Cayenne!

(No loss there, though...)
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Except for a big chunk of profits from the Porsche vehicle sales operations.
 
Wizegui said:
Except for a big chunk of profits from the Porsche vehicle sales operations.
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Um, right now? What profits? They appear to be in debt up to their eyeballs, so there is no profit.
 
Spectre said:
Um, right now? What profits? They appear to be in debt up to their eyeballs, so there is no profit.
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But for a company that primarily makes sports cars, having a sedan and SUV available isn't exactly a bad idea.
 
They will live. They just won't be independent anymore. They made a big fiscal gamble and failed.
 
Spectre said:
Um, right now? What profits? They appear to be in debt up to their eyeballs, so there is no profit.
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You say that as if it was the manufacturing that put them in this position. By all means Porsche got screwed on this deal. The problem is that if VW controls Porsche they're not going to be Porsche anymore. Everything that made them so great was their ability to survive anything, with the one car that just wouldn't die. VW can't be trusted in that sense, look what they did to Lambo. And while Porsche is near perfect as it is (their sports cars at least) you know as the new owner they'll feel compelled to mess about with them. This is a sad day. :(
 
Spectre said:
Um, right now? What profits? They appear to be in debt up to their eyeballs, so there is no profit.
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They can still be highly profitable and have massive debts - the two are not mutually exclusive.

The debt is only a problem if you can't service it, that relies on cash flow. Cash flow and profit are two completely different concepts.

I know that Porsche are probably not very profitable right now because of the fall in sales, but to say they're in debt and therefore there are no profits isn't necessarily true.
 
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Let me clarify.

Considering that the Cayenne isn't selling (they're offering incentives to people to buy them around here) and the Panamera apparently isn't selling either (per reports), there is no profit in those two lines any more. The longer those things sit around (and they are) the less profit they make. At this point, they aren't selling, so there are no profits.

Add to that the fact that they're up to their eyeballs in debt that they cannot service and you get the blanket statement of "there are no profits".
 
Spectre said:
Let me clarify.

Considering that the Cayenne isn't selling (they're offering incentives to people to buy them around here) and the Panamera apparently isn't selling either (per reports), there is no profit in those two lines any more. The longer those things sit around (and they are) the less profit they make. At this point, they aren't selling, so there are no profits.

Add to that the fact that they're up to their eyeballs in debt that they cannot service and you get the blanket statement of "there are no profits".
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That's what I figured you were saying - I couldn't help but clarify.
 
"These are not the manners that encourage a spirit of togetherness."
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Picture someone shouting this angrily, it's the greatest line.
 
Spectre said:
MMmmmh. So much for "the world's most profitable automaker."

MacGuffin: You just lost the right to claim that "mismanagement like at GM can't happen to Porsche."
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There is one major difference: The financial trouble Porsche is in, is not a result of their car production but because of risky adventures in the financial market and the attempted takeover of VW, which resulted in a feud among the owner families.

They are still making profit with their cars.

A comparison with what happened to the U.S. automakers is ridiculous. Wishful thinking won't relativise the mess in the USA.

Porsche CEO Wiedeking and his supporters in the supervisory board have manoevred themselves into a position, where they can't get out again without losing their face (or their jobs). The current question is, if they can overcome their pride and succumb to VW - because with that 700 million Euro loan to be paid, the Quatar people also won't invest in Porsche.

In the end financial trouble is financial trouble, even if the company itself is healthy.

But it's old news: I've been telling about this for months already here and there on this forum but obviously no one read it...
 
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