Croatian electric supercar specialist Rimac on Monday announced that it was acquiring a 55% controlling stake in Bugatti, a renowned old French performance motoring brand that's been a part of the VW empire since its 21st century resurrection.
The merger partners one of the world's highest-performance electric carmakers with the company producing the fastest petrol-powered road car on the planet.
According to Rimac, the two companies are "a perfect match for each other" and its new Bugatti Rimac joint venture with Porsche from the Volkswagen Group will "create a new automotive and technical powerhouse."
"I can’t begin to tell you how excited I am by the potential of these two incredible brands combining knowledge, technologies and values to create some truly special projects in the future," company founder Mate Rimac was quoted as saying.
No financial deals of the transaction were published. Porsche had already purchased a roughly one-quarter stake in Rimac in the run-up to the partnership's announcement.
"We are combining Bugatti's strong expertise in the hypercar business with Rimac's tremendous innovative strength in the highly promising field of electromobility," Oliver Blume, Chairman of the Executive Board at Porsche AG said. "Bugatti is contributing a tradition-rich brand, iconic products, a loyal customer base and a global dealer network to the joint venture. In addition to technology, Rimac is contributing new development and organizational approaches."
The Bugatti Chiron, that costs upwards of $3 million, is the fastest road car of them all in a straight line
Who owns what after the merger?
Rimac will hold a 55% stake in Bugatti-Rimac, with 37% belonging to founder Mate Rimac. The Porsche division will retain a 24% stake, Hyundai will hold 12%, and other investors will hold the remaining 27%.
But according to Rimac's press release, the Croatian company will retain full ownership and control of a new company, called Rimac Technology, that will continue developing its drivetrains, batteries and other components for electric vehicles. Not unlike US giant Tesla, selling electric vehicle components to other carmakers is a core component of Rimac's business model, as the company currently only produces performance cars with hefty price tags for a small band of customers.
"Mate Rimac will lead the new company. As CEO of Rimac Group, he will run both Bugatti Rimac and the new division, Rimac Technology. Bugatti and Rimac will both continue as separate respective brands, retaining existing production facilities and distribution channels," Rimac said. "Bugatti Rimac represents the company that will develop the future of both Bugatti and Rimac vehicles, by joining resources and expertise in research and development, production, and other areas.
Rimac, which recently unveiled the Nervera, will retain 100% ownership of its electric powertrain and battery development as part of the partnership
Bugatti manufacturing to remain in France
Bugatti cars will continued to be assembled in eastern France, where the company was first founded in 1909. To all intents and purposes, though, the VW Group revived the brand from the ashes around the turn of the century, developing and building first the Bugatti Veyron and then its successor the Chiron.
The extremely high-price, low-volume, research-intensive Bugatti production was likely always a losing venture for the VW Group, designed more to generate headlines and publicity than direct profits on models sold.
"In time, Bugatti Rimac's global headquarters will be situated at the recently announced Rimac Campus, also serving as the home of Rimac Technology," Rimac said, of a facility currently scheduled to open in 2023 on the outskirts of Zagreb.
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A career in cars — Ferdinand Piech
The Ferdinand families
Ferdinand Porsche's family tree probably sucks petrol, not water, out of the soil for sustenance. The empire that Porsche's grandson Piech helped forge was based around two classic designs. The Beetle (Käfer) was Porsche's own. Another grandson, Ferdinand Alexander Porsche - Piëch's cousin - penned the best-selling 911, the Beetle's big, boisterous brother. It's a family business after all.
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A career in cars — Ferdinand Piech
Track debut - Porsche 917
At sports car specialist Porsche, Piech took a keen interest in the racetrack, launching one of the most dominant, memorable Le Mans racers of the 20th century. The Porsche 917, the fastest car ever made in Germany at its 1969 launch, won Le Mans in 1970 and 1971. Its successors - the 936, 956 and 962 - all came back for more, but this was after Piech and cousin Wolfgang Porsche fell out...
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A career in cars — Ferdinand Piech
Engineering Audi's way out of trouble
Audi was a drab fleck on the German automotive landscape when VW bought it out in 1969, lacking Porsche's power, Mercedes' class and BMW's chic designs. Perhaps that's also why Piech was sent to cut his engineering teeth as head of development in the 1970s. He presided over several key developments, turbocharging a diesel engine for a family car; Audi won awards for its 80 and 100 models.
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A career in cars — Ferdinand Piech
The 'quattro' - rally's rebirth of four-wheel drive
Piech didn't invent four-wheel drive - that has an 1893 patent. But almost a century later, he brought it into the mainstream. The Audi quattro dominated the field, often with Finn Hannu Mikkola. Propelled by its reputation at rallies, Audi sold over 10,000 road-legal models and many more posters for kids' walls. And the in-line five-cylinder engine? Unlike "quattro," that was an Audi world first.
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A career in cars — Ferdinand Piech
A powerful state
Like any VW boss, Piech had to maintain close ties with the government of Lower Saxony, which owns 20% of VW and has boosted board voting rights. Plenty of influential politicians have made their way out of Hanover's parliament. Not least future German Chancellor Gerhard Schröder — by the time he gave Piech the state's medal in 1997, it was clear they'd be seeing more of each other further afield.
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A career in cars — Ferdinand Piech
Diversification, putting the Group in VW
Here, Piech and Schröder are reunited in the Czech Republic, at the 2001 factory opening of a new Skoda plant. At the end of the Cold War Skoda was the butt of scores of automotive jokes. (How do you double a Skoda's value? Fill the tank.) Now it's a VW subsidiary based on VW counterparts, embracing modern automotive "synergies." Growing the VW empire was a key priority in Piech's later life.
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A career in cars — Ferdinand Piech
Rolling with Pischetsrieder
This three-way handshake turned one of Piech's more bitter defeats back around. Having lost British luxury brand Rolls Royce to domestic rivals BMW, Piech and BMW CEO Bernd Pischetsrieder — together with Ralph Robins of Rolls — struck an accord allowing sister company Bentley to continue to use Rolls Royce powerplants. Thus Bentley became viable for VW, and Pischetsrieder, well, he became...
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A career in cars — Ferdinand Piech
The earlier heir-apparent
...Pischetsrieder became Piech's successor as the CEO of Volkswagen — but not for quite as long as everybody expected. A year after the three-way handshake, the ex-BMW boss was with VW subsidiary Seat. By 2002, he was at VW's head. But in 2006, Piech became dissatisfied — and before very long, the rising star had to go. A decade later, the same trick dramatically backfired with Martin Winterkorn.
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A career in cars — Ferdinand Piech
The fastest on the road
Another ambitious purchase under Piech's stewardship was long-dead brand Bugatti. Resurrected with 16-cylinders, a top speed of 407km/h (253mph), and a $2-million price-tag, there were no half measures in this Lazarus Project. For years, the Veyron was the world's fastest road car — a symbol of Piech's bold style. He left the VW Group as a 12-brand behemoth spitting out 10 million vehicles a year.
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A career in cars — Ferdinand Piech
Bundesliga by-product
Wolfsburg even managed the improbable during Piech's tenure, winning the Bundesliga league title so often earmarked for Bayern Munich in 2009. Goals from Brazilian striker Grafite, playing club ambassador in this image, propelled Felix Magath's side to the championship. Some Bundesliga purists might have sighed, however, as VW's factory team is often critically dubbed a "plastic club."
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A career in cars — Ferdinand Piech
Legacy renewed
Audi returned to Le Mans later in Piech's tenure. He might have been in Wolfsburg, not Ingolstadt, but the Le Mans chariot carried hallmarks of the boss' engineering days. Turbo diesel? Check. Quattro? Oh yes, that's basically a must nowadays for endurance racers. Audi's relaunch was even hybrid powered and claimed 13 Le Mans wins over 15 years starting in 2000.
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A career in cars — Ferdinand Piech
First Audi, then Porsche
At least part of the reasoning behind Audi's 2016 withdrawal was surely Porsche's return to the fastest class of endurance racing, LMP1. The automotive cousins were therefore competing directly on the track — making each other's lives harder. Porsche has taken over Audi's mantle since coming back, winning the 2015 and 2016 round-the-clock race at Le Mans.
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A career in cars — Ferdinand Piech
Selling up and moving out
In 2017, before his 80th birthday on April 17, Piech sold the majority of his remaining stock and took a back seat. Despite having stepped back from the board, Piech retained a 14.7% stake in Porsche SE — worth around €1.1 billion on the markets. But don't think for a moment that the sale dilutes the family influence — Piech's younger brother Hans Michel was the buyer.
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A career in cars — Ferdinand Piech
How it all began to end
Shareholder Piech's real ejection dates back to 2015. Piech suddenly tired of VW CEO Martin Winterkorn and sought to oust him. To the surprise of observers who had seen Piech hire and fire a number of top execs down the years, Winterkorn emerged from the standoff, retaining his post as Piech quit the boardroom. He got out just in time to dodge "Dieselgate," as it transpired.
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A career in cars — Ferdinand Piech
Leaving behind a legacy
After decades in the business, Piech passed away suddenly on August 27, 2019 at the age of 82. "The life of Ferdinand Piech was shaped by his passion for automobiles and for the employees that create them. He remained an enthusiast engineer and car lover until the end," his wife, Ursula Piech, said a statement announcing his death.
Author: Mark Hallam
msh/jf (AFP, AP)
