The curse of Pischetsrieder; Volkswagen.(Tough going for Volkswagen)

Economist (US), The, February, 2004

The wheels have started to come off the Volkswagen profit machine

IN MAY 1993, Bernd Pischetsrieder became chief executive of BMW. The Bavarian carmaker was riding high, its sporty saloons helping it to catch up with Mercedes-Benz, its German rival. The following January, Mr Pischetsrieder bought the Rover car group from British Aerospace. This was to prove a disaster. BMW failed to get a grip on the weak company; the acquisition cost it billions in losses and write-offs. Mr Pischetsrieder was eventually fired by an angry board.

Yet, in May 2003, he took over the top job at Volkswagen. Within a year, VW's fortunes have suffered their worst reverse since the firm's recovery in the early 1990s. Its latest figures imply a 95% fall in operating profits in...