International Finance
Brands Magazine November - December 2018

Unravelling the Volkswagen Success Story – Who Do they Own?

Unravelling the Volkswagen Success Story - Who Do they Own?
Exploring the world-famous auto brands that are part of the renowned Volkswagen family and their worth in the auto industry

Volkswagen have their own impressive range of vehicles, such as the much-loved classics including the Golf and Polo, as well as more recent editions to the VW dealership forecourt like the Scirocco. But Volkswagen’s ownership doesn’t end there. Their catalogue features several other renowned car brands. In this article, we’ll explore seven world-famous brands that are part of the Volkswagen family.

AUDI

  • Foundation year: 1909
  • Number of UK models: 65
  • Number of employees: 90,705
  • Sales in 2017: 174,982
  • Market share in 2017: 6.89%

Audi became part of the Volkswagen Group back in 1965. This was when Audi acquired the Auto Union GmbH from Daimler-Benz. For the first time since the end of the Second World War, Audi vehicles were produced thanks to this subsidiary. With more than 100 markets across the globe, Audi now stands as one of the leading premium car brands. This is, in part, down to Audi’s revolutionary technology. From piloted driving to an AI setup, the German manufacturer is leading the way to the future of driving technology.

BENTLEY

  • Foundation year: 1919
  • Number of UK models: 18
  • Number of employees: 4,332
  • Sales in 2017: 1,753
  • Market share in 2017: 0.07%

Unravelling the Volkswagen Success Story - Who Do they Own?Volkswagen and Bentley’s ties date back to 1998, though the partnership is quite complex. The story starts in 1997, when the then-owner of Bentley put Rolls-Royce Motors up for sale. Unsurprisingly, BMW made an offer of £340 million, as they supplied Bentley and Rolls-Royce with components and engines anyway. Plus, Vickers and BMW shared common ground in their experience in aerospace manufacturing.

But BMW weren’t the only bidders; Volkswagen made an offer of £430 million, outbidding BMW. But the deal didn’t give Volkswagen ownership of everything. Their bid secured the administrative and production facilities, vehicle designs, model nameplates, the iconic Spirit of Ecstasy, and the Rolls-Royce grille shape trademark. But Rolls-Royce Holdings retained the Rolls-Royce name and logo.

A year later in 1998, BMW supplied Bentley and Rolls Royce with new components for their cars and paid £40 million to licence the Rolls-Royce name and logo. After extensive negotiations from all parties, they reached an agreement that allowed BMW to continue with the deal to supply components and engines. Volkswagen attained the rights for the logos and names at this time. Then, in 2003, Volkswagen became the sole providers of Bentley cars, and BMW attained Rolls-Royce.

BUGATTI

  • Foundation year: 1909
  • Number of UK models: 1
  • Number of employees: 302
  • Sales in 2017: N/A
  • Market share in 2017: N/A

Art and technology were the forefront of car manufacturer Bugatti’s aims. In the last 100 years or more, Bugatti has unveiled some of the motor industry’s most interesting car designs.

In 1998, Volkswagen purchased the rights to manufacture Bugatti-named cars. Two years later, Bugatti was officially inducted into the Volkswagen Group. Plus, the guest house that was previously owned by Ettore Bugatti himself was purchased by Volkswagen Group. The house was turned into the company’s headquarters.

LAMBORGHINI

  • Foundation year: 1963
  • Number of UK models: 8
  • Number of employees: 1,606
  • Sales in 2017: N/A
  • Market share in 2017: N/A

Not only did Volkswagen acquire Bentley and Bugatti in 1998, but they also brought Lamborghini into the family. The super sports car icon that stunned the world with gorgeous designs and exceptional power used to be owned by MegaTech. MegaTech in turn were owned by SEDRCO pty, an Indonesian corporation.

But a financial crisis sparked in Asia in 1998, which meant Lamborghini needed to change its owner. An estimated $110 million offer saw the super sports car manufacturer purchased by Volkswagen. In the following months, a restructuring took place to make the holding company Lamborghini Holding S.p.A.

PORSCHE

  • Foundation year: 1931
  • Number of UK models: 37
  • Number of employees: 27,352
  • Sales in 2017: 14,051
  • Market share in 2017: 0.55%

It took three years for Volkswagen to fully bring Porsche into the Group.

Starting in 2009, the Volkswagen Group purchased a stake in Porsche AG, taking the first of many steps towards an ‘integrated automotive group’ with Porsche. Two years later, the two companies were meant to merge. But this was halted by legal risks, and the merger was deemed impossible.

As another year passed, however, Volkswagen announced they were currently in the process of purchasing the rest of the shares in Porsche for €4.46 billion. Porsche was finally brought into the Volkswagen Group in its entirety in August 2012.

SEAT

  • Foundation year: 1950
  • Number of UK models: 24
  • Number of employees: 14,716
  • Sales in 2017: 56,130
  • Market share in 2017: 2.21%

Volkswagen first set their sights beyond Germany with its co-operation agreement with Spanish company SEAT. Signed in 1982, the two companies quickly went to work, with 1986 seeing Volkswagen gaining a 51% controlling stake in SEAT. With this, SEAT became the first non-German subsidiary in the Volkswagen group. The stake was increased from 51% to 75% in December 1986.

Then, in 1990, Volkswagen Group purchased SEAT in its entirety.

ŠKODA

  •  Foundation year: 1895
  • Number of UK models: 27
  • Number of employees: 32,985
  • Sales in 2017: 79,758
  • Market share in 2017: 3.14%

The 1990s were a big year for acquisitions for Volkswagen, as the Group brought in Bentley, Bugatti, Lamborghini, and ŠKODA.

In 1991, Volkswagen and ŠKODA made a partnership agreement that resulted in Volkswagen gaining a 30% stake in ŠKODA. This later increased to 60.3% in December 1994, and then again to 70% in 1995.

By 2000, ŠKODA became wholly owned by the Volkswagen Group. The partnership was certainly beneficial to both parties, as the Czech car manufacturer saw deliveries increase sevenfold thanks to their partnership with Volkswagen.

THE VOLKSWAGEN GROUP

  • Collective years of experience: 731 years
  • Number of UK models: 213
  • Number of employees: 372,264
  • Sales in 2017: 535,136
  • Market share in 2017: 21.0 7%
  • Volkswagen themselves were founded in 1937, with 33 models available in the UK and employing 200,266 people of their own. In 2017, Volkswagen enjoyed 208,462 sales and an 8.21% share in the market. The data and figures in this article were correct as of August 2nd 2018.

This piece was curated by Vindis

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