VW's Preferred Shares Caught in the Crossfire as Porsche SE Demands an End to 'Taboos'
Published on 08/10/2026 at 03:23 | Redaktion boerse-global.de
The simmering conflict at Volkswagen has escalated into open confrontation, with the company's largest shareholder now publicly demanding that management abandon long-standing taboos around plant closures and job cuts. The Porsche SE holding company, which controls a significant stake in the Wolfsburg-based automaker, has urged the board to seriously consider shuttering facilities to accelerate the pace of restructuring — a move that has dramatically intensified pressure on CEO Oliver Blume's leadership team.
A Boardroom Revolt Over Cost-Cutting Plans
The Porsche SE's intervention comes at a particularly volatile moment. Just days earlier, Volkswagen's supervisory board had rejected the management board's revised austerity package, known as "Group Target Picture 2030," which includes potential plant closures and aims to fundamentally overhaul the company's cost structure. The board's decision to block the plan — at least temporarily — has exposed deep fractures between management and labor representatives, with another supervisory board meeting on the closure plans scheduled for September.
The stakes could hardly be higher. According to a Spiegel report, Volkswagen is considering closing four German plants starting in 2031 — Zwickau and Emden first, followed by Hannover in 2032 and the Audi plant in Neckarsulm in 2034. Manager Magazin has reported that up to 100,000 jobs across the group could be at risk. Works council chief Daniela Cavallo did not mince words in her response to management's approach, telling media that "enough is enough" and that the board's treatment of employees was "beyond disrespectful."
Half-Year Results Highlight the Pressure
The governance battle unfolds against a backdrop of deteriorating financial performance. Volkswagen reported first-half 2026 earnings per preferred share of EUR 2.56, down sharply from EUR 4.34 in the same period last year. Group deliveries fell 6 percent to 4.1 million vehicles, with Chinese deliveries plunging 37 percent in the second quarter alone. The one bright spot was the Brand Group Core division, which bundles the volume brands: it lifted operating profit 4.5 percent to EUR 3.61 billion, with the operating margin edging up to 4.9 percent.
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The management board presented its "Target Picture 2030" — comprising twelve initiatives designed to cut overhead costs from roughly EUR 45 billion to around EUR 34 billion — alongside these results. The supervisory board's decision to halt the package has left the restructuring timeline uncertain.
Analysts Split on the Stock's Prospects
The mixed half-year numbers produced a divided response from the analyst community. Jefferies trimmed its price target from EUR 120 to EUR 115 but maintained a Buy rating. Oddo BHF struck a far more cautious tone, downgrading the stock to Neutral with an EUR 80 price target, arguing that the results and conference call had "once again highlighted the persistent, significant structural challenges, particularly in China, but also regarding competitiveness and utilization of industrial capacity." Bernstein Research held its Market-Perform rating with an EUR 100 target. The wide dispersion of views underscores the uncertainty surrounding the speed and success of the announced restructuring.
A Multi-Billion-Euro Counterweight
Away from the operational headaches, Volkswagen continues to streamline its portfolio. In June, the group reached an exclusive agreement with Bain Capital to sell a majority stake in Everllence: 51 percent of the shares will be transferred, while Volkswagen will retain 49 percent as a significant minority shareholder in the medium term. The transaction, structured as a leveraged buyout, is expected to generate around EUR 7.4 billion for the automaker. According to Börsen-Zeitung, Bain outbid a consortium led by CVC Capital Partners and another led by EQT AB, which included VW's major shareholders Porsche Automobil Holding and Qatar Investment Authority. The deal is expected to close by the end of 2026, pending regulatory approvals.
Market Sentiment Remains Cautious
The stock has shown relative resilience in recent sessions despite the turmoil. On Friday, the preferred shares closed at EUR 76.18, up 1.20 percent on the day — though the secondary article records a slightly different Friday close of EUR 76.42, up 1.51 percent. Either way, the shares remain below their 50-day moving average of EUR 78.18 and have lost roughly 27 percent since the start of the year. The stock sits about 30 percent below its 52-week high of EUR 109.10 from mid-December, though it has recovered more than 10 percent from its early-July low of EUR 69.20.
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The Porsche SE's public push for a faster overhaul adds a fresh layer of uncertainty for investors. The holding company's demand to abandon "Denkverbote" — a German term for unspoken prohibitions on certain options — signals that the pressure for deep cost cuts now comes not just from external competitive forces but from within the ownership structure itself. The situation is further complicated by reported billion-euro losses at the Porsche AG sports car subsidiary, which have triggered additional cost-saving measures across the group.
For Volkswagen, the challenge is navigating between the demands of its largest shareholder and the traditional constraints of German co-determination, where the works council and the state of Lower Saxony — which holds a blocking minority — wield considerable influence over strategic decisions. The next key date is the September supervisory board meeting on plant closures, followed by third-quarter results expected on October 29. Until then, the direction of the stock will likely be dictated by the escalating boardroom drama rather than operational fundamentals alone.
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