Page last updated at 15:18 GMT, Sunday, 26 October 2008

Porsche raises Volkswagen stake

Porsche and VW badges

Porsche has increased its stake in Volkswagen, saying it hopes to have a majority holding in Europe's biggest carmaker by the end of the year.

Porsche revealed its stake had risen to 42.6% - saying it had chosen to make the announcement because of uncertainty in the car market.

It had previously already been been the largest shareholder, holding about 35%.

Porsche has said it did not want to merge with VW - but create an alliance that could take on competition.

It has also argued that it needs a strong influence at VW, which makes components for a third of Porsche cars.

The car industry, which is often seen as a barometer of the world economy, is entering a deep recession, with sales and profits tumbling.

Manufacturing plants are closing, production is being cut back, jobs are being axed and car company share prices are tumbling as a consequence.

United plans

Last week Porsche said disagreements between family members in the company had been resolved.

Two cousins, Wolfgang Porsche and Ferdinand Piech, have held conflicting opinions on how to take over VW.

Mr Piech - who is both the Porsche boss and head of the VW supervisory board - has backed unions who object to the takeover of their company.

But Mr Porsche said that the families were "united" on plans including the idea of co-management of both companies.

The so-called "VW Law" - which essentially gives German authorities the right to veto strategic decisions Volkswagen - will also be scrapped.

Print Sponsor

Global car industry: Audio reports
23 Oct 08 |  Business
Niche firm Porsche sets big goals
02 Jun 08 |  Business
VW outlines global expansion plans
19 Mar 08 |  Business

Has China's housing bubble burst?
How the world's oldest clove tree defied an empire
Why Royal Ballet principal Sergei Polunin quit


Americas Africa Europe Middle East South Asia Asia Pacific