The weekly German car magazine Auto Motor und Sport publishes their assessment of the performance of German car company bosses each year. I'm afraid that I don't agree with all of them, but here they are:
At the top of the list with five stars is Wendelin Wiedeking. He's achieved this position for the sixth year in a row. They rate him as "top cars, top sales, top profit". The profit, for sure, is very good at 612 million Euros. And Cayenne sales at 40,000 units in 2004 is very good for Porsche too. They congratulate him for the success of the Cayenne. I'd question that the Cayenne was the best thing for Porsche. Yes, it is a success and is highly profitable for Porsche, but they are now a truck company, no longer a sports car company. They sell more Cayennes worldwide than they do sports cars. I don't think that this is the best thing for the Porsche image. Also Porsche is considering a new 4-door sedan as a new product to use the V-8 engine from the Cayenne. Alas, this would really make Porsche "just another car/truck company". Is big short-term profit really the best thing for Porsche in the long term?
I would also question Porsche's design philosophy with the "new" 911 looking far too much like the old 911, and the "new" Boxster looking too much like the old one. The only design mandate with the new Boxster was to make it look less like the 911. I don't think this is the right approach to attract new customers, but I've said this before...
In a three way tie for second place with four stars are Helmut Panke (BMW), Jürgen Schrempp (DaimlerChrysler), and Martin Winterkorn (Audi). Wow, do I ever disagree with this selection! Even some at Auto Motor und Sport disagree with the placing of Schrempp with four stars, thinking that he should have one less. I'd say even less than that.
Schrempp presides over a management disaster at DaimlerChrysler that he created. He fired the one person, Wolfgang Bernhard, who recommended drastic measures to fix the company -- then implemented those measures. Bernard will reappear at Volkswagen later this year. While Chrysler is more successful now, Mercedes is not. The flagship of DaimlerChrysler, Mercedes-Benz, is suffering from very low quality levels, and consequently poor consumer confidence. Warranty claims and low sales are taking the toll on Mercedes' profits. By trying to cut costs too much at Mercedes, the image of the best engineering in the industry has been squandered. Then there is the seemingly continuous bottomless money pit called Smart. Is this the record of a four-star executive? Not in my mind. I wouldn't even give him three stars.
Helmut Panke of BMW seems to be going from success to success. Sales and profits are up despite the plunging dollar value. That is good news, but remember that Panke inherited a very successful company when he assumed the chairmanship in 2003. Despite the awful styling of Chris Bangle and the journalists' panning of iDrive, BMW sells lots of cars. Their subsidiaries MINI and Rolls Royce are successes as well, MINI more than Rolls Royce. Rolls sold 445 cars in 2004 whereas Maybach sold fewer than 400 worldwide. Panke is also building a foundation for BMW sales in China. This certainly sounds like at least a four-start executive to me.
Martin Winterkorn at Audi presides over a successful company that is still strongly influenced by Ferdinand Piech. Working within the confines of Volkswagen, the General Motors of Germany, is a difficult task. The fact that Audi continues to deliver cars with beautiful styling inside and out is a big plus. Audi delivers the majority of profits to Volkswagen and Auto Motor und Sport thinks they could do more. I would say that four stars is a fair assessment for Winterkorn.
Assigned three stars is Volkswagen's boss, Bernd Pischetsrieder. Unlike Panke, Pischetsrieder inherited a disaster from Piech. The new Golf, designed under Piech's rule is not as successful as it should be. Is this Pischetsrieder's fault? Then there are the other Volkswagen brands that often duplicate each other in the market. Will Piech's folly, the Bugatti Veyron ever get to market? The problem that Pischetsrieder has is that Piech is still chairman of the executive board and exerts a big influence on the company from there. I'd say that, give the situation, four stars might have been a better choice. Also Wolfgang Bernhard can only help here.
Another three star executive is Bernhard Mattes of Ford. He has managed to stop Ford's sales slide in Germany, but doing so required huge discounts. That pushed Ford's German business into the red. Unfortunately, Mattes like Pischetsrieder is under the direction of others, so his rule of a company isn't as absolute as an executive like Schrempp. Mattes can only sell what Dearborn gives him. I'd say that given the situation, three stars is probably right, but it should include all of Ford.
At the bottom of the list with two stars is Hans Demant of Opel. He has just recently assumed the chief executive position at Opel, and has inherited a huge mess. The magazine says that the mess is so big that sorting it out is a battle he is unlikely to win. That is why the assessment of two stars was made. They also question, given the situation at Opel, and GM as well, if anyone could do that job any better than Demant.
Given that these assessments were made with blinders just looking at the present, they probably were correct. If one looks at the future, however, I would suggest that they are incorrect, primarily with a high award for Wiedeking. By ransoming the Porsche image for short-term profit, I believe that the future is not rosy for Porsche. Porsche was built as a great sports car company and now it is just another car/truck company. How is Porsche today any different than Chevrolet? The Corvette is fully the equal of a 911 in performance, and the list of Chevrolet trucks is as good as the Cayenne. Another problem Porsche has for the future is the dead end of the 911. By a quirk of history, the 911 is rear-engined, something that "tradition" now requires. Today Porsche has a much better car, the Boxster, which is mid-engined, but must be "limited" in performance so as not to threaten the more expensive flagship 911. The company is also saddled with the history of the 928, a front-engined car that was supposed to replace the 911. For many reasons, it didn't.
Other German executives don't have this history problem. Take BMW, for example. Their mantra is "the ultimate driving machine". They have taken that to the low end of the market in Europe, with the 1-Series. It seems to be a success because it is the best driving example of a car that size. Yes, it doesn't have the space efficiency of a front-driver, but the sacrifice was made to assure a great drive. With a history of (only) great driving, BMW could make the best driving minivan and say that it fit into their product line successfully, couldn't they?
