Car Wars at Wolfsburg: Conflict between Porsche and Volkswagen Executives

Car Wars at Wolfsburg is a case study about the conflict between Porsche and Volkswagen executives. The conflict arose due to differences in opinion on product development strategies. The conflict handling styles used were forcing, which was not appropriate. The eventual outcome was the termination of Porsche's chairman, Wendelin Wiedeking.

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Car Wars at Wolfsburg
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Table of Contents
1. Write a synopsis of the case in approximately.......................................................................2
2. Identify and discuss the sources of conflict between Porsche and Volkswagen executives..2
3. Describe the conflict handling styles used by Wendelin Wiedeking and Ferdinand Piech.. .3
4. What was the eventual outcome of this conflict?...................................................................4
References:.................................................................................................................................5

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1. Write a synopsis of the case in approximately
Answer- Car wars at Wolfsburg is a case study regarding the conflict in between two persons
who play a very vital role in the car company. The Porsche is one of the world popular luxury
car companies that relies on the VW, the Volkswagen Group for some of its car production
and manufacturing purpose. Hence, it clearly means that these two companies are connected
with each other. Both Wendelin Eiedeking and Ferdinand Piechh are the represents for the
Porsche and the Volkswagen Company respectively (Latif, 2017). Gradually, a conflict took
place because of the difference in the opinion of the two companies and this has resulted in
other impacts. Both the two companies agreed to a joint venture. However, at that time,
Porsche was not agreed of selling to the VW group. It had overwhelming debts of around a
billion dollars. Therefore, they were required to request VW intervene to in order to buy
some of its own businesses (Stonig, 2016). Wiedeking wanted to increase the profit of the
company at the expense of their employees and he then also displayed a very rude attitude
towards the management that assisted in increasing the internal conflicts or wars in between
him and Piech. Also, Wideking used to think that Volkswagen would be much more
profitable if the company get rid of all the luxurious Bugatti or Phaeton as because of the fact
that they are very expensive. However, Piech on the other side felt that his vision and
perspectives are been threatened. Ultimately, Volkswagen succeeded in the process of taking
over of the Porsche.
2. Identify and discuss the sources of conflict between Porsche and Volkswagen
executives.
Answer- It is to state that the conflict in between these executives of the two companies took
place in the strategies and the beliefs that they had regarding how to approach the process of
product or car development. The main reasons that gave rise to conflict in between
Volkswagen and Porsche executives are many. The CEO of Porsche, Wendelin Wiedeking

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wanted to apply the practises to make the company one of the top most auto makers to
Volkswagen division, cutting down the net production of the lines which were neither highly
profitable nor popular enough and in this process, he removed the inefficient operations
(Elson, Ferrere and Goossen, 2015). This practices were not liked by Ferdinand Piech, the
CEO of Volkswagen and he wanted to stay more focused on the impressive engineering
instead of just profits (Topfer & Duchmann, 2016). Hence, both the chairman of the
companies had a breakdown in their communication and that has led to difference in their
views regarding the goals of the company and the direction which both of them wanted to
follow. As both of their perspectives on the issue of company development and growth were
uncommon, the goals of the companies were becoming incompatible and this has resulted in
an internecine warfare in between them. It is to mention that none of the chairman was right.
Both of them are somewhat at the fault for the very conflict (Dudenhoffer, 2016). Prior to the
merger, both the men seemed to not have communicated the visions and perceptions they
hold for the company with one another. Therefore, as both the companies got merged,
problems started growing in between both the chairman.
3. Describe the conflict handling styles used by Wendelin Wiedeking and Ferdinand
Piech.
Answer- To my point of view, the conflict handling styles used by both the chairman would
be forcing. Forcing refers to the formal power or authority that is used in order to satisfy the
concerns of one’s own without considering the concerns of the other party which is involved
in the particular conflict (Waithaka, Moore-Austin & Gitimu, 2015). However, it is also to
state that the conflict handling style used by Wiedeking was stronger than that of Piech but it
is also a fact that Wiedeking was in an intention of winning the disparity at the expense of
each other. In this case, the conflict handling styles used by them were not that appropriate as
because of the fact that these styles were jeopardizing their business. Forcing is not at all the

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appropriate style for conflict handling for any of the party to use in this context. They must
have utilised the technique of problem solving where both of them could try to find out the
solution which would be beneficial or advantageous to them. They could have also used
compromising technique in order to find a common ground in which both of them would
have had to give up something or the other in order to attain something. In this way, the
growth of the companies would not have jeopardised then.
4. What was the eventual outcome of this conflict?
Answer- As both the chairman were unable to resolve the conflict that took place in between
them, the company Porsche had to end up facing financial problems and that then resulted in
the termination of its chairman Wendelin Wiedeking.

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References:
Dudenhöffer, F. (2016). Das VW-Kostenproblem ist bedrohlicher als der Dieselskandal. ifo
Schnelldienst, 69(11), 34-38.
Elson, C. M., Ferrere, C. K., & Goossen, N. J. (2015). The bug at Volkswagen: Lessons in
co‐determination, ownership, and board structure. Journal of Applied Corporate
Finance, 27(4), 36-43.
Latif, A. A. (2017). Volkswagen brand: The fall of an auto empire. Journal for Global
Business Advancement, 10(3), 281-304.
Stonig, J. (2016). Der Volkswagen Konzern, Teil A (2002-Aug 2015, Der Griff nach der
Weltspitze) und Teil B (Sept 2015-Juni 2016, Super-GAU im integrierten Konzern).
Töpfer, A., & Duchmann, C. (2016). Das Scheitern an tyrannischer Ambition. WiSt-
Wirtschaftswissenschaftliches Studium, 45(8), 400-406.
Waithaka, A. G., Moore-Austin, S., & Gitimu, P. N. (2015). Influence of Conflict Resolution
Training on Conflict Handling Styles of College Students. Research in Higher
Education Journal, 28.