Of Hitler, Volkswagen, Porsche, and Money.

July 21st, 2010 by GoldyLocks

An Interesting history of Nazi, Government, and Private ownership of some of the world's largest car companies.

An Intriguing Day in History –

On July 21, 1960 Germany passed what is referred to as the Volkswagen law; which transferred control of the car company from the German Government (which acquired it from the destroyed Nazi’s at the end of  WWII) to a variety of private regional government owners.  A distinguishing feature of the law was that no one entity could hold more than 20% of the voting stock of the company.  The German people retained 20% ownership and the region in Germany known as  Lower Saxony retained 20%, and the rest open for private, stock traded purchase.

The idea was that no one conglomerate could control Volkswagen and set it up for a hostile takeover and disruption of the company.

That worked pretty well up until the European Union came into existence with laws regarding the free flow of capital across borders.   A European judge ruled the Volkswagen law was against the capital flow mandates of the new European Union and this opened the way for parties to buy more than 20% of the company.

Porsche stepped up and quickly bought 30.9% of Volkswagen.  This set up  a takeover bid under a different German law that required a company which acquires more than 30% stock to bid for the entire company.   Over a period of two years, Porsche bought controlling interesting in Volkswagen and now effectively owned Volkswagen.

But, Porsche and Volkswagen have shared a long and interesting history. After all, it was Ferdinand Porsche who designed the original Volkswagen — the German People’s Car!

Comments on this interesting history are welcome.  My thought is that lawyers and bureaucrats likely own a chunk of the company for all the legal and regulatory fees involved in making the deals to get Volkswagen owned by Porsche.

Anyway, whoever owns it, Volkswagen and Porsche remain essentially German companies.

Advertisement

2 Responses to “Of Hitler, Volkswagen, Porsche, and Money.”

  1. JerryandMary says:

    The first Volkswagen Beetle was sold in the United States in 1949. A total of two Volkswagens sold that year in the U.S.. Who would have thought the Volkswagen would become one of the most reliable automobiles in the world. I used to refer to them as “those damn bugs”

    Despite my love for old American automobiles I have to say that Volkswagen and Toyota both make excellent rides that more then compete with American manufacturers (I know there are those that like to argue about that but it is my opinion)

    Jerry

  2. corsa says:

    Of course, over the last year or so, Porsche, the most profitable automaker on the planet, tried to buy up the rest of VW, and in the process, nearly bankrupted themselves. So VW came back and bought Porsche.

Leave a Comment

You must be logged in to post a comment.