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VW's Future

DW staff (als)October 24, 2007

German papers commented on an EU court ruling on Tuesday, Oct. 24, that overturned a law protecting automaker Volkswagen from unwanted takeovers.

Volkswagen sign outside at a dealership
Some say the VW law was antiquated; others believe it safeguarded the company and workersImage: AP

"Nothing can stop Porsche now," Berlin's Die Welt daily wrote. "The 'Volkswagen law' is now history, but still, not much will change at the company. It will now no longer be governmental regulation, but former competitor Porsche that will see to it that Volkswagen will remain a national champion … It is certain that Porsche will raise its stake to an over 50-percent majority. Then, the state of Lower Saxony will have to ask itself why it even needs to continue participating in the firm."

Now: The "Golf" inspired "Generation Golf"Image: AP

The daily Tageszeitung (taz), also based in Berlin, took a look at what the ruling will mean for the unions and workers. "For trade unionists, the message is clear: the interests of the capitalist market are valued more than those of the workers interested in payment and the security of their jobs. The EU, which had pursued the legal case against Germany at the EU's highest court in Luxembourg, has thereby massively interfered in the freedom of member states to design their political-economic policies as they see fit. Just as in the service sector, the EU is placing its bets on stronger liberalization -- and accepts that its citizens, who fear wage dumping and the loss of their jobs, see Brussels as a threat."

Düsseldorf's business daily Handelsblatt noted that "no one questions that there are industries worth protecting. Regulation by the state is generally accepted, whether it be for telecommunications, defense, energy or transportation. Soon, there will also likely be state regulation of high-tech companies. But we should have learned from the VW law: it did not keep Volkswagen from almost going broke. And it also did not help in the Mount Olympus of the most successful auto industries in the world. VW is merely average. Only under Porsche's reign will that change."

Then: the VW "Beetle" was famous around the worldImage: AP

Berlin's Tagesspiegel had doubts about that: "Those who rejoiced that VW would pare down, become faster and more profitable jumped the gun. VW will retain its political dimension because the company … is far too large to only be preoccupied with itself. In addition, the law will not change the fact that VW workers are organized (95 percent are in the IG Metall trade union). Cooperation between employees and employers will remain unique, like in all the car companies."

The Frankfurter Rundschau wrote that the VW law "forced management, the works council and unions to work together and to find innovative solutions to problems. Those solutions may have caused the hair of business management hardliners to stand on end because they prevented the radical reduction of company costs. However, they also ensured that VW was able to withstand crises without suffering unbearable strain."

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