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Porsche names new CEO

September 30, 2015

The legendary muscle car maker has a new head. Oliver Blume takes over after Matthias Müller was tapped last week to right parent company VW's sinking ship. Meanwhile, the problems keep piling up for Volkswagen.

Symbole Porsche VW Volkswagen Übernahme
Image: dapd

German luxury sports car maker Porsche on Wednesday named its production head Oliver Blume as its new chief executive officer (CEO).

Blume fills the gap at the top of Porsche after former CEO Matthias Müller was tapped last week to take over from disgraced VW head Martin Winterkorn, whose career was cut short by the emissions scandal.

Porsche's supervisory board also appointed Detlev von Platen, who currently heads Porsche Cars North America, as the company's new sales and marketing chief.

Chairman Wolfgang Porsche said he was "particularly pleased" that Blume and von Platen were both company insiders.

"Porsche doesn't only have a highly motivated workforce, but also a very large number of qualified top managers," he added.

At just 47-years-old, Blume is already considered a VW Group veteran. The trained mechanical engineer joined VW's upmarket Audi brand in 1994 as a trainee. He has spent the past two decades with the German car giant, where was charged with heading up Porsche's development and logistics division in 2013. He is due to take up his new post as CEO on Thursday.

Porsche joined the stable in 2012, making it VW's 12th brand. It's one of the group's main profit engines, contributing about 20 percent to the company's overall earnings in 2014.

Not out of the woods

For now, Porsche has been spared the same embarrassment many of VW's other brands have suffered. On Tuesday, the group announced what could become one of the biggest ever recalls in the industry. Of the 11 million diesel vehicles believed to have been tampered with, Volkswagen's own brand makes up more than half, with Audi accounting for 2.1 million, Skoda 1.2 million and Seat 700,000.

This doesn't mean Porsche is out of the woods just yet, though. Wolfang Hatz, the company's head of Research and Development, is widely expected to get the boot sooner than later, suspected of being involved in the emissions manipulation.

Bumpy road ahead

Meanwhile, legal cases against Volkswagen are piling up. In addition to some three dozen lawsuits filed in the US, and a handful in Canada, an Italian consumer group on Wednesday said it had presented a class action lawsuit against the carmaker, accusing it of deceiving owners and potentially harming the environment. Norway said it, too, was considering action over VW's emissions rigging.

And that's unlikely to be the end of it for the Wolfsburg-based Goliath. France is now also said to have launched an official investigation into the automaker.

"Following the recognized fraud of a carmaker in the United States...there is a probe from the DGCCRF (the Directorate for Competition Policy, Consumer Affairs and Fraud Control) that started on Friday and whose goal is to assess if Volkswagen had similar practices (in France)", AFP news agency quoted a source close to the French Economy Ministry as saying on Wednesday.

That probe, the source added, would later be extended to all other carmakers operating in France.

This came as Volkswagen added seven more names to its list of countries, where vehicles are now known to have been equipped with the affected EA 189 diesel engines. In France, this will prompt recalls of nearly one million vehicles, whereas the firm expects to send out letters to owners of some 1.2 million vehicles. In the Czech Republic, that number is close to 150,000, while it is nearly 95,000 in Portugal.

In the Nordic nations, more than half a million are believed to be affected. VW said 225,000 vehicles had been rigged in Sweden, around 150,000 in Norway, over 90,000 in Denmark, and as many as 50,000 in Finland.

Sign of greed

The scandal has caused a global outcry, with buyers, lawmakers and industry heads expressing shock at VW's brazen attempt to cheat authorities. On Wednesday, German Finance Minister Wolfgang Schäuble weighed in, blasting the group's misconduct as a sign of "greed for fame, for recognition."

"One looks at it in amazement and always sees how it ends up," Schäuble said in an interview with the news provider "RedaktionsNetzwerk." He said competition is "incredibly rough, if you want to be successful on the global market."

VW's scandal is a massive embarrassment for Germany, as well. For years, the country lobbied against stricter regulations for automakers and held up VW as an example of outstanding German engineering. "In the end, VW will no longer be what it has been. A lot will change from a structural perspective," said Schäuble.

Many fear that the scandal will have a negative effect on the German economy as well since VW employs more than 600,000 people worldwide and is a major part of the country's exports. Schäuble rejected these claims saying: "We will emerge from the crisis stronger. We learn from crises."

pad/uhe (AP, AFP, dpa, Reuters)