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Volkswagen issued a statement confirming rumors last night that Porsche, a luxury car brand, was seeking to break away from Volkswagen and try to list independently in Germany. Volkswagen and Porsche Holdings have reached an agreement to make it clear that Porsche will be listed independently, but it will eventually require the signing of the board of directors of Volkswagen and Porsche Holdings, the statement said. Wall Street estimates that if Porsche is eventually independent, it will be valued at between 60 billion and 85 billion euros, while the entire Volkswagen group now has a market capitalization of about 112 billion euros, close to building another Volkswagen company, which could become one of the largest IPO in Europe.

On the one hand, affected by the shortage of chips, many brands performed poorly last year, which also led the automobile group to tilt its resources to its luxury brands. Against this background, Porsche China completed 95671 new car deliveries, an increase of 8% over the same period last year, and became the world's largest single market for the seventh year in a row. Porsche's annual sales exceeded 300000 vehicles for the first time in the world, reaching 301915 vehicles, up 11% from 2020.

On the other hand, Tesla is attacking the city and land, so that the major automobile brands have to reiterate their investment in electrification so as not to become the dust of history. This is only the beginning of electric cars, and it is not really time for market competition. With the emergence of the electric vehicle market, the competition of internal combustion engine technology, which has been studied for hundreds of years, has become the competition of battery, motor and electronic control system. In fact, the technical difference between brands becomes very small, and consumers' choice dimension becomes smaller and smaller. In the past, the price of a product was evaluated according to the power base of the model and the tone of the brand: for example, it has a better engine, a better gearbox, a better interior, even if it has less space, it can be defined as a luxury car. While electric cars break the gap between these products, while buying Wei is ideal, they will also consider BMW Audi at the same time, which is strange, but it has become more and more the norm of consumer choice. In terms of electric vehicle products, Porsche China has introduced a total of 16 pure electric and plug-in hybrid models. In 2021, the delivery of new Porsche electrified models accounted for 18%, a growth rate of 8%.

All traditional brands hope to invest heavily to catch up with the development of the times. On July 13, 2021, Volkswagen announced that it would invest 73 billion euros in the early stage, from the development of mechatronics platform SSP, standard battery, charging network and self-driving technology. A week ago, it was also reported that Volkswagen planned to buy self-driving technology from Huawei for 3 billion euros. The progress and results of electric vehicle technology are not clear, but the money has to be spent first. in 2015, Volkswagen was almost fined to bankruptcy because of the emission gate incident, so it is clear that all kinds of ways to raise money are options that can be made. Previously, Volkswagen's CEO said it was not optimistic that Porsche would once again be independent, and today's Volkswagen statement seems to force him to consider this financing option.

In 1938, Hitler and Ferdinand Porsche founded Volkswagen, and for a long time, members of the Porsche family served as Volkswagen executives. Porsche holding is the main shareholder of Volkswagen, and Volkswagen is the shareholder of Porsche. The noble brand and Volkswagen brand are tied together because Porsche tried to control Volkswagen.

The Porsche family became a minority shareholder in Volkswagen through Porsche holding, and the German Commercial Code originally stipulated that when the shareholder's stake reached 75%, it could gain control of a German company. However, for Volkswagen, a state-owned enterprise in Germany, there was originally a special law "popular law", which requires shareholders to hold more than 80% of the shares in order to achieve control of the Volkswagen group. The government of Saxony, Volkswagen's federal state, owns 20.1% of Volkswagen and Porsche controls 31%.

With 80% of the red line of control, Volkswagen's control is unlikely to fall into the hands of others. But in 2007, the Porsche family overturned this legal restriction through the European Union Supreme Court. In 2009, the Porsche family borrowed heavily to buy shares in Volkswagen on the market. At its peak, Porsche owned a total of 74.1% of Volkswagen shares. But it never achieved the 75% control target and was saddled with huge debts. In the end, Porsche Holdings turned its acquisition of Volkswagen into a merger, ending the dispute with Volkswagen's purchase of a 49.9% stake in Porsche.

Three years later, Volkswagen completed its full acquisition of Porsche, which became a sub-brand of Volkswagen. Porsche made a profit of about 3.4 billion euros in the first nine months of 2021, accounting for about 34 per cent of Volkswagen's overall automotive business, according to Volkswagen's third-quarter results. At this time, choosing to go public independently is a winner for both Volkswagen and Porsche. The price of Volkswagen Group is only to put some of its Porsche shares on the circulation market in exchange for funds in the face of Tesla's development, while Porsche is independent. In terms of finance and brand, its own development also has a lot of benefits. The only trouble is Porsche's share structure and considerations among shareholders, and even if it is under siege, it may be a long wait for the deal to be approved, as Volkswagen's statement says.

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