Making Sense Of The Confusing VW-Porsche Ownership LoopIt's one of the strangest relationships in the entire automotive industry. Giphy
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Do you know which company made your automobile? Before you answer, it might not be as simple as you think.
It’s no surprise that many automakers are owned by larger conglomerates or companies that might appear to be competitors. This has been a longstanding tradition in the auto industry, but two of those companies make things even more complicated.
One cannot exist without the other
So how did Porsche and Volkswagen become so entangled? It all dates back to VW’s inception in Germany ahead of World War II.
The very first model (the classic Beetle) was designed by Ferdinand Porsche, who later went on to form his own company. But his early models borrowed heavily from VW parts and when the company was privatized after the war, he decided to buy up a bunch of its stocks.
There was a problem, though.
Over the next several decades, Porsche attempted to buy up 75% of VW in a convoluted attempt to pay off the debt it incurred by buying up the company’s stock in the first place. In the end, however, it achieved just over 50% ownership.
Volkswagen owns Porsche … and vice versa
Since Porsche couldn’t buy up enough of VW to repay its debt, it pursued a different method that involved selling itself to the company it was trying to buy. And here’s where things get (even more) complicated.
Porsche is actually divided into two companies — Porsche AG makes the cars and Porsche SE is a holding company that owns AG.
When Germany repealed its law requiring 80% ownership in VW to exert control, that meant the majority stake Porsche SE had was enough to grant it ownership of the cocompanymany. So in short, Porsche SE owns VW, which in turn owns Porsche AG