Bernd Pischetsrieder for CEO

MARK PHELAN BEHIND THE WHEEL: VW exec gets boot for talent

BY MARK PHELAN FREE PRESS COLUMNIST
November 12, 2006

QUESTION: How do you get fired at Volkswagen?

ANSWER: Improve the cars it builds and reduce what it costs to build them.

The giant German automaker hasn't said that's why it abruptly dismissed CEO Bernd Pischetsrieder last week, but VW hasn't said anything about the shocking move. All we have to go on is the dapper Bavarian's track record, which consists largely of prying concessions out of VW's powerful German unions and getting its model line back on the rails after previous management's costly detour down dead ends like the failed Phaeton luxury sedan.

Pischetsrieder did well enough that VW's board extended his contract through 2012 just five months ago. Since then, VW's sales and profits have risen steadily. Profits took a hit in the second quarter as VW works through a radical -- by German standards -- restructuring that includes 20,000 job cuts and working longer hours in exchange for job security.

Pischetsrieder and his handpicked lieutenant -- the dashing Wolfgang Bernhard, late of Mercedes-Benz and Chrysler -- had restored a semblance of sanity to VW.

With that résumé, don't be surprised if Wolfgang is the next one voted off the island. If that happens, he has options, including a return to Detroit.

Pischetsrieder and Bernhard are two of the smartest, most charismatic executives in the auto industry. The odds are people at DaimlerChrysler, Ford and GM are checking to see if there's a nice corner office available.

Bernhard, the VW brand chief, still has a job, but this isn't his first rodeo. He's been on the pointy end of Germany's bloodthirsty corporate politics before, when a combination of union enmity and executive infighting cost him the job he longed for: running Mercedes-Benz.

VW Chairman Ferdinand Piech allied himself with the company's union to oust Pischetsrieder, and Bernhard may again find himself on the wrong side of a power play. The union doesn't like the concessions Bernhard squeezed out of it, and Piech, who ran VW for nine years, seems to have a hard time retiring gracefully.

There's no shortage of companies that could use Pischetsrieder or Bernhard's talents. Fiat's CEO job just opened up. Ford could use a high-profile executive with unimpeachable credentials as a performance-oriented car guy. GM took a run at Bernhard once, and the job he might have had -- heir to Bob Lutz as gearhead-in-chief -- is open. DaimlerChrysler CEO Dieter Zetsche is a friend and fan of Bernhard's, so he might get another chance to run Mercedes, or even Chrysler, if problems in Auburn Hills get worse.

The auto industry employs countless people. Few can match Bernhard or Pischetsrieder's understanding of how to develop first-rate cars and build them profitably.

It's enough to get them hired just about anywhere. And apparently just what it takes to end up fired or on thin ice at VW.