Lamborghini review marks step in VW’s march to $220b

Bloomberg

Volkswagen AG’s plan to review options for its Lamborghini supercar division marks a further step in Chief Executive Officer Herbert Diess’s campaign to transform the world’s biggest automaker and more than double its market value.
The German manufacturer is weighing a potential sale or stock listing for the Italian brand, according to people familiar with the matter, as Diess channels resources to the main VW, Porsche and Audi units. No decision has been made and an earlier plan to move Lamborghini from under the Audi umbrella to Porsche remains an option, they said.
Structural change is always a challenge at Volkswagen because of the multiple power bases that play a role in major decisions. Diess has been sounding out support for ideas to reshape Volkswagen as part of a broad strategy review ahead of an expected industry shakeout. His goal is to reach a market value of $220 billion.
The company has started preparations to fold Lamborghini into a separate legal entity and the process might conclude toward the end of next year, the people said, asking not to be identified because the deliberations are confidential.
Restructuring the super-luxury brand would fit with Diess’s goal to channel resources more efficiently and avoid duplicated efforts. VW signalled that any decision is likely a ways off, saying it has no plans for a Lamborghini sale or IPO.
Diess, 60, has been pushing an overhaul of Volkswagen since he became CEO 18 months ago — investing billions in electrification, selling a stake in truckmaker Traton SE, and putting industrial-transmission and diesel-engine units up for sale. He’s also forged an alliance with Ford Motor Co to share the costs of developing commercial vans, e-cars and autonomous driving.
“We shouldn’t spread ourselves too thin,” Diess said in an interview published over the weekend in Germany’s Sueddeutsche Zeitung newspaper. “That might be hard in some cases, but it’s the only viable way.” SZ also reported on a possible sale or IPO of Lamborghini, without saying where it got the information, as VW drafts a revamp of its 12 automotive brands. Such a move would allow VW to focus on VW’s brands that are global household names, and allocate funds to the highest-returning brands, potentially at the expense of nameplates like the mass-market Skoda and Seat.