Volkswagen's muscle-flexing adds to MAN upheavals
By: Alan Bunting, Monday, December 07, 2009, AutomotiveWorld.com
If an earthquake had struck southern Germany, with its epicentre close to Munich, the resulting shockwaves could not have created much more local havoc than the reverberation of recent events surrounding MAN, the country's second largest truck and bus manufacturer. There appear to have been several contributory causes to the upheavals, though the details remain largely a mystery to the outside world.
The first inkling of managerial disturbance occurred in March when it was announced, out of the blue, that MAN Nutzfahrzeuge's technical director Professor Karl-Viktor Schaller was leaving the company "by common agreement". This was despite his being highly regarded for his engineering expertise, notably in the field of advanced diesel engine design, having played a key role in the development of MAN's all-new 10.5 and 12.4 litre D20 and D26 power units. There was no further explanation for his departure.
Then in May came the shock news that the German tax authorities were investigating suspected corruption among MAN's sales and marketing personnel. It was learnt that over 100 employees were under suspicion of paying some €14m, between 2002 and 2005, in bribes to customers mainly outside Germany to secure orders for new vehicles.
The notional acquisition by MAN of VW's truck operations in Brazil earlier this year, almost certainly resulting from a decision made in Wolfsburg rather than in Munich, was seen in many quarters as a further erosion of MAN's operational independence.
Quite different ripples have been disturbing MAN's operations in the last year or two, with the ever looming presence of Volkswagen as part owner of the business. Volkswagen currently holds 30% of MAN but it has indicated its intention to increase that holding in due course to more than 50%. The notional acquisition by MAN of Volkswagen's truck operations in Brazil earlier this year, almost certainly resulting from a decision made in Wolfsburg rather than in Munich, was seen in many quarters as a further erosion of MAN's operational independence.
Volkswagen's financial stake in MAN's Swedish rival Scania implies an additional threat to the German commercial vehicle maker's market freedom, with a longer-term likelihood of the two marques being coerced from above to share major components, perhaps even engines. Such a strategy has worked well for Volkswagen in passenger cars, where Audi, Skoda and SEAT share VW powertrains.
But whether Volkswagen's undoubted success as a car producer makes it well qualified to make the right strategic decisions in running a two-marque heavy commercial vehicle business remains questionable. Many in the truck industry have their doubts. Among them it would seem is Hakan Samuelsson who, in perhaps the greatest shock of all, resigned as MAN group CEO on November 23. His reasons for leaving were unspecific, while referring rather nebulously to the need for a "fresh start". Recent profits were badly down but no more seriously than for most commercial vehicle makers in the current downturn.
The appointment, albeit on an interim basis, of someone with an engineering rather than an administrative background is redolent of earlier and happier times at MAN.
A week later came two more bewildering top-level departures. Samuelsson's successor as CEO of MAN Nutzfahrzeuge, Anton Weinmann resigned, together with fellow board member and chief finance officer Karlheinz Hornung. Again no concrete reasons were given.
Almost a decade ago, Samuelsson, a Swede, was head-hunted by MAN - somewhat intriguingly, in the light of subsequent events - from Scania, to head up its truck and bus operations. It was a surprise appointment, especially as the post had always previously been held by native Germans. He was clearly deemed to have performed well in his first few years with MAN, because in 2005 he was promoted to group CEO.
An interesting side issue of the ongoing MAN drama is the question of where Samuelsson might now find a berth. At 58 he is unlikely to want to put his feet up. Might he return to Scania? After all, the Swedish company's CEO Leif Ostling is likely to retire next year when he reaches 65.
personal relations between Ostling and Samuelsson are said to have been not just cool, but ice-cold, ever since the latter jumped ship, in what might well have been seen as an act of betrayal, back in 2000.
The answer must be no, given the VW threat, of which he has experienced a bitter taste at MAN, allegedly at the hands of Volkswagen group chief financial officer Hans Dieter Poetsch, who is said to be tightening his grip on MAN's - and potentially Scania's - purse-strings. In any case, personal relations between Ostling and Samuelsson are said to have been not just cool, but ice-cold, ever since the latter jumped ship, in what might well have been seen as an act of betrayal, back in 2000.
An interim group CEO has been nominated to take over the reins from Samuelsson. He is Georg Pachta-Reyhofen, Schaller's predecessor as technical director of MAN's commercial vehicle operations, who for the past two years has headed up MAN Diesel, the quite separate division which produces large non-automotive engines.
The appointment, albeit on an interim basis, of someone with an engineering rather than an administrative background is redolent of earlier and happier times at MAN. Through the late 1990s the company was headed successfully by Klaus Schubert, an engineer whose early faith in common-rail fuel systems for heavy-duty truck diesels was thought foolhardy by competitors but, more than a decade on, is now seen almost universally as the way forward.
The opinions expressed here are those of the author and do not necessarily reflect the positions of Automotive World Ltd.
Published on Monday, December 07, 2009
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