Porsche's New CEO Faces First Test With Smaller Boxster

Matthias Mueller, the new Porsche AG chief executive officer tasked with reviving the luxury-car maker’s vehicle lineup, faces his first test with the introduction of a new line of smaller Boxster roadsters.

Mueller, 57, will replace Michael Macht, who is promoted to become Volkswagen AG’s production chief to succeed Jochem Heizmann starting Oct. 1, the carmakers said yesterday. Mueller led product management at VW’s Audi luxury brand for four years through 2007 before moving to the parent company.

Deliveries of the Boxster and Cayman mid-engine sports cars fell 12 percent to 7,630 in the first nine months, or less than half of Porsche’s best-selling Cayenne model. To arrest the drop, Porsche in February introduced the 53,100-euro ($67,000) Boxster Spyder, which features a 3.4 liter-six-cylinder engine and is designed to be driven with its textile roof down.

“We have to make progress with Porsche,” VW CEO Martin Winterkorn told reporters late yesterday at an event near Munich. “Mueller is the right person to deliver it. He has excellent ideas and a very clear concept of how new products have to be brought in line.”

Mueller’s appointment also underscores Winterkorn’s push to complete a merger with the sports-car maker next year. Volkswagen, which aims to surpass Toyota Motor Corp. in deliveries and profitability by 2018, is taking over Stuttgart, Germany-based Porsche SE’s carmaking operations as the companies build on a partnership that includes sharing vehicle platforms.

Source: Porsche SE via Bloomberg

The Porsche Boxster Spyder automobile. Close

The Porsche Boxster Spyder automobile.

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Source: Porsche SE via Bloomberg

The Porsche Boxster Spyder automobile.

New Cayenne

Porsche wants to expand its four-model lineup to double sales in the medium term to 150,000 cars and SUVs. Deliveries in the nine months through April declined 0.1 percent to 53,605 vehicles. Full-year sales may still exceed the 75,238 deliveries of fiscal 2009 as a new version of the Cayenne SUV, its best- selling model, and a six-cylinder Panamera car reach showrooms, the company said June 18.

The Cayenne shares its chassis and major parts with Volkswagen’s Touareg and the Q7 SUV made by Audi. Volkswagen also makes the Panamera’s body.

“Mueller was very successful at Audi, which entered new niches when he was responsible for product strategy,” said Daniel Schwarz, an analyst in Frankfurt at Commerzbank AG with a “hold” recommendation on Porsche and a “buy” on Volkswagen. “He can now apply that to Porsche.”

70 Models

Volkswagen’s preferred shares fell 14 cents, or 0.2 percent, to 71.24 euros in Frankfurt trading. Porsche added 93 cents, or 2.7 percent, to 35.88 euros.

VW, Europe’s largest carmaker, increased first-half sales by 15 percent to more than 3.5 million cars and sport-utility vehicles worldwide, Winterkorn said yesterday. Deliveries of VW brand cars exceeded 2 million, he said.

By the end of 2010, VW group will have introduced 70 new models, facelifts or revamps worldwide, including about 30 for the VW brand, Winterkorn said.

“We will clearly perform better than the overall market, which may grow about 5 percent this year and set another strong record on sales,” he said. “We’re on a good growth path in Brazil, China and India.”

The Wolfsburg, Germany-based carmaker will build its 10th plant in China as part of a plan to double production capacity in its biggest market to 3 million vehicles within four years.

Volkswagen plans to invest as much as $1 billion in Mexico over the next three years, including a new engine factory, Heizmann said yesterday at a VW plant near Puebla, Mexico.

U.S. Successor

VW is negotiating with U.S. chief Stefan Jacoby over terms of his departure before he may take over as CEO at Volvo Cars, people familiar with the matter said June 25.

“We have very surprisingly lost Stefan Jacoby,” Winterkorn said. “Volkswagen of America is a very attractive brand and we will present a successor in the nearest future.”

VW showed a new version of the Sharan family van at the event in southern Germany yesterday. The model, the Sharan’s first revamp since its introduction in 1995, will be longer and have a wider wheelbase. The vehicle, priced starting at 28,875 euros, will reach showrooms on Sept. 3.

Frank Tuch, a former Porsche executive, will join VW as group quality chief starting Aug. 1, Winterkorn said.

Macht, 49, spent a decade running Porsche’s production before he was promoted to oversee the carmaking division when CEO Wendelin Wiedeking quit following the collapse of plans to take over VW. Winterkorn is now also CEO of Porsche SE, the sports-car maker’s holding company. VW owns 49.9 percent of the Porsche AG auto-manufacturing unit in a first step toward the companies’ merger.

Capital Increase

Porsche SE will proceed with a planned capital increase in the first half of 2011, Winterkorn said. VW still aims to complete the integration next year in spite of legal challenges by some hedge funds in the U.S., the CEO said.

Heizmann, 58, will run a new unit overseeing VW’s truck holdings. He has been a member of Volkswagen’s executive board since February 2007. His new role will be to tighten cooperation between truckmakers Scania AB and MAN SE, people familiar with the matter said in April.

Volkswagen holds 71 percent of the voting rights in Soedertaelje, Sweden-based Scania and is the biggest shareholder in Munich-based MAN with a 29.9 percent stake.

“These are two very attractive brands. We also have a timetable,” Winterkorn said, declining to give details. “We have very concrete steps in mind on how to foster the integration of MAN and Scania.”

To contact the reporter on this story: Andreas Cremer in Berlin at acremer@bloomberg.net.

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