Change Management

VW boss wants to make history as well as cars

In the next five years, Herbert Diess must revolutionize Volkswagen, making it a leaner, cleaner, technology-focused company. If he fails, it could spell disaster for the car industry, and maybe the entire German economy.

News Bites

Angela Merkel visited Chemnitz on Friday, three months after the violent death of a German triggered far-right protests in the eastern city. The chancellor met with Saxony’s state premier and the local mayor. (Tagesspiegel)

The North Rhine-Westphalia chapter of the far-right AfD party received an illegal €49,000 donation in 2016 from a Dutch foundation – the same one that gave €150,000 to an AfD district chapter in southern Germany, it emerged on Friday. Both payments, along with a €130,000 donation from a Swiss drugs company, have been returned.

The European Commission will launch a procedure next Wednesday to fine Italy over its 2019 draft budget, according to EU officials. Rome has proposed a 2.4% budget deficit for next year, triple the amount planned by the previous government. (Reuters)

Engelbert Lütke Daldrup, boss of Berlin’s perennially unfinished airport BER, seeks to relax technical standards laid down by the TÜV testing organization to ensure the facility opens in October 2020. (RBB)

VW confirmed it was considering expanding its cooperation with Ford beyond the field of light commercial vehicles, without giving details. Handelsblatt reported two weeks ago the partnership could include electric and self-driving cars.

VW raised its investment budget for electric cars, self-driving technologies and new mobility services to €44 billion over the next five years to 2023, from €34 billion announced last year. The latter plan was for the years 2018-2022.

SAP defended its $8-billion purchase of Qualtrics, saying the US software company was a good fit and its technology offered broad application.

Commenting on Britain’s cabinet crisis over Brexit, a German government spokesperson said a disorderly departure of Britain from the EU would be the worst-case scenario.

ECB President Mario Draghi expects the euro-zone economy to continue its expansion despite a slowdown in the third quarter. The central bank’s bond-buying program is set to end next month, he confirmed.

Berlin asked for the removal of three judges presiding over a €4.4 billion claim from Swedish utility Vattenfall, which is demanding compensation for Germany’s 2011 decision to shut down nuclear power plants. If successful, the case will face years of delay as the new judges read up on the matter.

German telecoms operators will not have to provide a nationwide high-speed 5G cellphone network, but can gradually build up a grid, the federal telecoms authority decided. The firms will, however, have to reduce the number of dead zones for G4 reception.

Alice Weidel, co-floor leader of the Alternative for Germany, rejected accusations she dropped the ball when her electoral district failed to immediately report donations worth €130,000 and €150,000. Some politicians have urged her to resign.

A majority of Germans surveyed – 56% – now think Angela Merkel should stay on as chancellor till 2021, up 7 points since January. Some 41% want her to resign early. (ARD)

Merkel’s favored candidate to succeed her as party leader, Annegret Kramp-Karrenbauer, should become the new CDU head, winning 46% support among party members, a survey showed. Rival Friedrich Merz got 31% and Jens Spahn 12%. (ARD)

Horst Seehofer, 69, Interior Minister and leader of Bavaria’s Christian Social Union, will resign as the party head on January 19. He did not refer to his position as minister, although some want him to give up that post as well.

The Greens party closed in on Angela Merkel’s Christian Union alliance, grabbing 23% of the votes in an election poll, up six points from last week. Merkel’s group was stable at 26%. The Social Democrats and Alternative for Germany dropped slightly to third place with 14% each. (ARD)

VW Group CEO Herbert Diess will also become head of the carmaker’s Chinese operations when current country boss Jochem Heizmann retires in January. Diess wants to take control of the business in China because it generates the most profit.

Thanks to higher tax revenue, Germany’s 16 states increased their joint budget surplus to €19.6 billion in the first nine months, up more than 50% from the same period last year.

Schenker, Deutsche Bahn’s logistics arm, will overhaul its board, nominating the American Xavier Garijo, Dutchman Christian Drenthen and sea-freight expert Thorsten Meincke as new executives. Ewald Kaiser, in charge of freight management, will resign, but the CEO and three others will keep their jobs.

Ford is open to investors in its self-driving car business, but expanding a partnership with VW would be a “delicate dance,” Ford boss Jim Hackett said. The carmakers agreed in June to jointly develop light commercial vehicles, such as pickups. (Reuters)

Deutsche Bank’s spun-off asset management arm, DWS, will retain a worldwide presence, keep Frankfurt as its base and needs to work more efficiently, new CEO Asoka Wöhrmann told staff.

More than 30 international companies, from Allianz to BlackRock to Calpers, have agreed to report additional information about employees, trust and the social value of corporate activities. They want to focus on goals that benefit capitalism and society in the long run, instead of aiming just for short-term profit targets.

Berlin should not force coal power plant operators to shut down their operations by 2020, but reach agreements with utilities to take plants out of commission by 2022, possibly in return for compensation, a government committee has tentatively agreed.

Euro-zone consumer prices rose 2.2% in October, the fifth straight month inflation was above the ECB’s mid-term target of “close to but below 2%.”

Manfred Weber, campaigning for the presidency of the European Commission, said he may try to become both head of Bavaria’s CSU party as well as top the EU Commission. Current statues don’t permit dual roles.

He also said he is in favor of a pan-European military controlled by the European parliament. However, he said diplomacy must always take precedent over brawn.

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Change Management

VW boss wants to make history as well as cars

In the next five years, Herbert Diess must revolutionize Volkswagen, making it a leaner, cleaner, technology-focused company. If he fails, it could spell disaster for the car industry, and maybe the entire German economy.

Pocketbook politics

CDU hopefuls trip over each other to offer tax relief to party base

Merz, Kramp-Karrenbauer and Spahn are using tax reform as a sign of how they plan to revitalize the Christian Democratic Union, as they race to succeed Merkel as the party's chairperson.

Drone rangers

German billionaire invests in drone-defense startup

Dedrone is a warning system to help airports, oil refineries and smart cities protect their airspace from menacing drones.

A new spark

VW revamps production for the electric age

The world's biggest carmaker plans to make rechargeable vehicles at three German factories, snubbing the technology that spawned Dieselgate. One plant will churn out models half the price of a Tesla.

Editors’ Pick

Pressure on Berlin

French finance minister: We need a European empire

European unity should be more than just a photo opportunity, France’s Finance Minister Bruno Le Maire said in an exclusive interview. But while France is more than willing, Germany remains reluctant.

Dive In

Promise of an 'outsider'

Friedrich Merz could bring Europe new opportunities

The seasoned aspirant to the CDU leadership could breathe new life into euro-zone reform, writes a leading EU analyst.

Be our guest

Germany pins hopes on immigration law to fill skilled-worker gap

Despite hiccups and criticism, a draft of Germany's first-ever, liberalized immigration law addresses the most urgent concerns of business.

GDP down

Germany’s third-quarter economic downturn does not herald recession

The economy is slowing, but the country's first decline in more than three years was due to the special factor of auto production, experts say.

Ask a German

Handelsblatt explains

Much about Germany is confusing or surprising to foreigners - and even to Germans. Our editors provide clarity.

Big-tent parties

Why the CDU, CSU and SPD are losing voters, and how to win them back

Germany's big-tent parties in the political center are in a slow-motion crisis. The author of a new book on their malaise offers some advice.

Delivery Service

Germany’s Eatclever seeking funds for foreign expansion

Eatclever, a food delivery startup specializing in soups, wraps and noodle dishes, wants to find new investors to help it go international in a fast-growing market.

SME Power


Volkswagen, Bayer and Adidas are household names. But more than 95 percent of Germany's economy is generated by lesser-known firms that aren’t listed on the blue-chip DAX Index.

Mutual Respect

Popularity of teaching profession across Europe is worst in Germany

Most Germans wouldn't recommend their children become teachers, according to a major international survey. The less respect teachers get in society, the worse the students will perform.

Merger Vindicated?

Monsanto boosts Bayer profit even as legal risk mounts

Lawsuits against the glyphosate-based Roundup are multiplying but that hasn't impacted sales of the weedkiller.

Gold bricks

German real estate

Long tipped as a rising star in the European market, Germany has finally come into its own. Our series on residential property highlights some favorite cities for expats and investors alike.

Swan song

Merkel backs Macron call for European army in European Parliament speech

Chancellor extols ideals of European solidarity but maintains strictly German perspective.

Budget Discipline

Let the markets chasten Italy’s populists

The EU must stand firm and let markets pressure the Italian government into backing down in its budget dispute with Brussels, writes Commerzbank chief economist Jörg Krämer.

Intellectual property

Patent, trademark protection for German firms at risk in no-deal Brexit

Europe-wide protections for trademarks and design, as well as patent extensions, would no longer apply in Britain if there is a no-deal Brexit.

Overstaying His Welcome

Horst Seehofer gives up party post, wants to stay in cabinet

Interior Minister Horst Seehofer is stepping down as the CSU's party chief after electoral losses. But he's holding on tight to his government post in a break with parliamentary protocol, though there are strong candidates for the job.

Two worlds meet

Germany’s family-run companies turn venture capitalists, fund startups

The Mittelstand is investing in German startups in the hopes of learning from its younger, more nimble peers. Meanwhile, the startups are hoping to tap the Mittelstand's deep pockets.

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