VW boss rubbishes French, German notionof national industry 'champions'

9th June 2004, Comments 0 comments

LONDON, June 9 (AFP) - French and German efforts to build industrial champions is "nonsense" and businesses should be the ones to decide their own strategies, the head of German auto giant Volkswagen said Wednesday.

LONDON, June 9 (AFP) - French and German efforts to build industrial champions is "nonsense" and businesses should be the ones to decide their own strategies, the head of German auto giant Volkswagen said Wednesday.

VW chief executive Bernd Pischetrieder told the Financial Times in an interview: "If politicians want to pay money for us to do something we might welcome it, but it is nonsense."

He dismissed political attempts to create large European groups in key sectors, such as the recent French-backed merger of pharmaceutical companies Aventis and Sanofi-Synthelabo, as interference.

French Prime Minister Jean-Pierre Raffarin and German Chancellor Gerhard Schroeder were to have met on June 1 to discuss the creation of industrial champions, but the meeting has not yet taken place.

The VW chief said Wednesday that industrial groups would make better decisions if politics remained on the sidelines.

"At the end of the day this (is) not going to work just because a politican tells us," the Financial Times quoted Pischetrieder as saying.

"If there is a business logic it will happen anyway, and if their is no business logic it won't happen."

The comments are significant because the VW chief is considered close to Schroeder, who as former minister-president of the German state of Lower Saxony sat on the automaker's supervisory board.

The state owns an 18.1-percent stake in VW, but under the so-called VW Law, no single shareholder may hold more than 20 percent of the group's voting rights, independent of the size of their actual shareholding.

The law also gave the state its supervisory board seat, independent of the size of its stake.

That means Lower Saxony is VW's single biggest shareholder and can veto strategic decisions.

The VW Law is currently in the crossfire of the EU Commission in Brussels, which sees it as incompatible with EU competition rules.

But Pischetrieder downplayed the dispute Wednesday, saying the law could easily be circumvented and that Germany's defense of it was "because politicians want to be re-elected".

European Union officials say the law violates an EU principle of free movement of capital by protecting the group from takeovers.

© AFP

Subject: French news

 

0 Comments To This Article