{"id":3056,"date":"2026-06-27T05:10:10","date_gmt":"2026-06-27T05:10:10","guid":{"rendered":"https:\/\/reliablemovingcrews.com\/?p=3056"},"modified":"2026-06-27T05:10:10","modified_gmt":"2026-06-27T05:10:10","slug":"volkswagen-law-the-unique-structure-behind-europes-biggest-carmaker","status":"publish","type":"post","link":"https:\/\/reliablemovingcrews.com\/?p=3056","title":{"rendered":"Volkswagen Law: the unique structure behind Europe&#8217;s biggest carmaker"},"content":{"rendered":"<div><div><div><ul><li>Summary<\/li><li>Companies<\/li><\/ul><\/div><div><\/div><\/div><div>FRANKFURT, June 26 (Reuters) &#8211; Volkswagen&#8217;s plans to close plants in Germany and nearly double planned job cuts to around 100,000 have \u200bput the spotlight on its unique governance and ownership structure that have drawn criticism from investors for years.<\/div><div>Like \u200cother German conglomerates, the 89-year-old automaker is the result of decades of expansion and strategy shifts, resulting in an empire that stretches from mass-market SEATs to luxury Lamborghinis, as well as stakes in sports car maker Porsche AG (P911_p.DE)<svg><\/svg><span>, opens new tab<\/span> and truck maker Traton (8TRA.DE)<svg><\/svg><span>, opens new tab<\/span>.<\/div><h2>WHAT IS THE VOLKSWAGEN LAW?<\/h2><div>The strong influence of workers dates back to \u200bthe early days of Volkswagen before World War Two, when the Nazis built Volkswagen&#8217;s main factory in Wolfsburg with money \u200bthat came in part from assets expropriated from trade unions.<\/div><div>This, and the use of forced labour, formed \u2060the financial basis of the company. After the war, the British, who were responsible for the plant at the time, decided to \u200bplace trusteeship of the company in public hands.<\/div><div>To this day, the state of Lower Saxony, where Volkswagen is based and where it operates five \u200bof its six western German assembly plants, has a 20% voting stake.<\/div><div>In 1960, when the company was transformed into a joint-stock corporation, the so-called Volkswagen law was passed, handing significant influence to Lower Saxony and workers to protect the business from outside influence.<\/div><h2>WHAT DOES IT SAY?<\/h2><div>There are two critical clauses.<\/div><div>Decisions that usually \u200brequire a three-quarters majority at the annual general meeting must be passed by more than four-fifths of Volkswagen shareholders, giving Lower Saxony \u200ba blocking minority.<\/div><div>Any decision to build or move a production plant also needs approval of a two-thirds majority in the 20-strong supervisory board, the law \u200csays, without \u2060specifically mentioning closures.<\/div><div>This means the 10 members on the board representing German labour can veto any far-reaching plans that affect factories.<\/div><h2>WHAT IS VOLKSWAGEN&#8217;S OWNERSHIP STRUCTURE?<\/h2><div>It&#8217;s complicated, mainly because there are two different classes of Volkswagen shares: preferred stock that is listed in the German benchmark DAX index (.GDAXI)<svg><\/svg><span>, opens new tab<\/span>, and common stock (VOWG.DE)<svg><\/svg><span>, opens new tab<\/span> which carries voting rights.<\/div><div>Most of the group&#8217;s equity, covering both share classes, is owned by Porsche SE (PSHG_p.DE)<svg><\/svg><span>, opens new tab<\/span>, the investment \u200bvehicle of the Porsche and Piech \u200bfamilies, which holds a 31.9% \u2060stake in Europe&#8217;s top carmaker.<\/div><div>The German state of Lower Saxony owns 11.8%, while Qatar holds 10%.<\/div><div>When it comes to voting stakes, however, the picture changes: With a 53.3% voting stake, Porsche SE holds a \u200bmajority. Lower Saxony has 20% of votes and Qatar 17%.<\/div><h2>HOW DOES THAT AFFECT GOVERNANCE?<\/h2><div>Volkswagen has been criticised \u200bby investors for \u2060governance shortcomings that are partly related to its ownership structure, which gives Porsche SE great control over the company even though it does not own a majority of all shares.<\/div><div>Volkswagen CEO Oliver Blume gave up his Porsche CEO post at the beginning of this year after years of \u2060criticism from \u200bsome shareholders over his dual role as head of two large and related \u200bauto groups.<\/div><div>Along with the market deterioration, governance issues have added to pressure on Volkswagen&#8217;s shares, which trade around 16-year lows. Uncertainty over succession at the Porsche and Piech families, \u200bled by Wolfgang Porsche, 83, and Hans Michel Piech, 84, is also a factor.<\/div><div><address><div><div><noscript>\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"120\" height=\"120\" alt=\"Victoria Waldersee\" class=\"wp-image-388\" src=\"https:\/\/reliablemovingcrews.com\/wp-content\/uploads\/2026\/05\/0a4b6f63ce7c44c99950a34d4fa9bb8c.avif\"\/><\/figure>\n<\/noscript><\/div><div>Victoria Waldersee<\/div><\/div><div><ul><li><span><div><svg><title>Email<\/title><\/svg><\/div><\/span><\/li><li><span><div><svg><title>X<\/title><\/svg><\/div><\/span><\/li><li><span><div><svg><title>Linkedin<\/title><\/svg><\/div><\/span><\/li><\/ul><\/div><\/address><\/div><\/div><p>Read more <a href=\"https:\/\/reliablemovingcrews.com\/?p=3054\">Prediction market platform Polymarket tops $1 billion in annualized revenue, source says<\/a><\/p><p>Read more <a href=\"https:\/\/reliablemovingcrews.com\/?p=3052\">SpaceX set to join Nasdaq 100, paving way for wave of passive buying<\/a><\/p><p>Read more <a href=\"https:\/\/reliablemovingcrews.com\/?p=3050\">US allows Anthropic to release Mythos to \u2018trusted partners\u2019<\/a><\/p>","protected":false},"excerpt":{"rendered":"<p>Volkswagen&#8217;s plans to close plants in Germany and nearly double planned job cuts to around 100,000 have \u200bput the spotlight on its unique governance and ownership structure that have drawn criticism from investors for years.<\/p>\n","protected":false},"author":1,"featured_media":3055,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[100,101],"class_list":["post-3056","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-workforce","tag-world-at-work"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.6 - 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