The Clash’s hit song “Should I Stay, Or Should I Go” might perhaps perfectly fit the business situation for Ducati, within its parent company, Volkswagen AG.
The Italian motorcycle brand’s status in the German conglomerate has for the past few years been held on a tenuous string. Rumor about its divestiture, its selling to another company, are constantly dogging the iconic brand.
Talking to Bloomberg TV after Volkswagen’s quarterly earnings report, VW CEO Herbert Diess explained that there are two paths forward for Ducati, and one of them includes selling Ducati to the highest bidder.
The Volkswagen Group got a new CEO last week, and in less than seven days, that news has already sparked renewed rumors in the German automobile conglomerate divesting itself of Ducati Motor Holdings.
For those who have been following Ducati’s saga, there was much talk last year of Volkswagen selling off a number of its other brands, all under the reasoning that the German company would need to raise capital to cover its mounting Dieselgate liabilities.
The logic for that reasoning wasn’t sound, but the actions were certainly there, with Volkswagen tendering offers from a number of would-be suitors.
There was a fly in the ointment though: Volkswagen’s labor unions, who control half of the VW Group’s board seats, and were vehemently opposed to any brand divestitures.
Because of the unions, any sale – including Ducati’s – was a non-starter for the Volkswagen executives, though that didn’t keep the warring factions from trying. By the end of last year though, it seemed we had put this issue to bed. 2018, however, is a new year.
Reports out of Italy are confirming the news that Ducati will remain as a part of the Volkswagen Group, with the German company ceasing its pursuits of divesting the Italian motorcycle company from its ranks.
This shouldn’t come as a surprise to anyone following Ducati’s business situation, as reports of the divestiture stalling out were circulating this time last month.
The news seems to come with a bonus, with Ducati CEO Claudio Domenicali reportedly confirming the news internally (other reports quote Audi CEO Rupert Stadler doing the same as well).
For the past few months, talk of Ducati’s divestiture from the Volkswagen Group has grabbed the attention from news outlets and Ducatisti alike, as the future of the Italian motorcycle company seemed uncertain.
Internally, a power struggle was a play, with Audi keen to unload Ducati from its books, but lacking the support from upper management in the Volkswagen Group.
Talks reportedly hit the skids once it was realized that the Volkswagen labor unions, which control half of the seats on the Volkswagen Group management board, weren’t onboard with divesting Ducati from the holding group.
This is probably information that investors would have liked to know, before they spent the time and resources putting together purchase proposals for Audi’s consideration.
Now, with no change in the position of VW’s labor unions, and with the possibility of an internal consensus seemingly out of sight, it seems talk of Ducati’s divestiture have stalled, with little chance of them resuming this year.
The hits keep on coming, in terms of Volkswagen’s plans (or non-plans) to sell its Italian motorcycle manufacturer, Ducati Motor Holding.
According to the latest report from Reuters, the votes are lacking on supervisory board for Volkswagen, when it comes to selling Ducati and transmission-maker Renk.
The lack of votes at the Volkswagen board isn’t a new problem, of course, with the German company’s labor unions accounting for half of the board seats, and reportedly very unenthusiastic about selling either brand.
Americans probably can’t place the name “Rajiv Bajaj” when they hear it, though his last name should give you a clue. As the Managing Director of Bajaj Auto, Rajiv Bajaj is in charge of one of the largest motorcycle brands in the world.
As we learned yesterday, Bajaj is one of the many firms vying for ownership of Ducati Motor Holding – that is of course assuming that the Volkswagen Group actually sells the iconic motorcycle brand, which is a big “if” to make.
For Bajaj though, they seem fairly confident that Ducati will sell, and even more confident that the Italian brand will be part of their motorcycle portfolio. Talking to the Economic Times, Bajaj has hinted that his company was in the final stages of sealing the deal with Ducati.
Reuters continues to dish on Ducati’s possible divestiture from the Volkswagen Group, with news that several bids have been placed on the Italian motorcycle brand. Reuters says that amongst the bidders are several key brands like, Polaris, Bajaj, and Royal Enfield’s owners Eicher Motors.
Noticeably absent from the list of potential buyers however was the much talked-about Harley-Davidson, a name that the same Reuters reporters first offered as Ducati’s potential future owner.
Now Reuters offers us another name as the likely front-runner, pointing to Italy’s Benetton family (as in, the United Colors of Benetton), which has reportedly submitted a bid of $1.2 billion, through its investment arm Edizione Holding.
Rumors and reports continue to swirl around Ducati, as the Italian manufacturer is linked to one brand or another for a potential divestiture from the Volkswagen Group. And now, the latest name being thrown into the hat is none other than iconic American brand Harley-Davidson.
In a report by Reuters, Harley-Davidson is linked to buying Ducati by unnamed sources, with a purchase price that is pegged around €1.5 billion, a number that has been put together by the bean-counting minds at Goldman Sachs.
Volkswagen is said to be taking bids on Ducati this July, which means the fate of the Italian motorcycle brand could be decided by the end of this year.
There has been a lot of rumor as of late, about whether Ducati is for sale, and who would be a potential buyer of the iconic motorcycle brand. We have seen just about every large motorcycle manufacturer at some point has been linked to buying Ducati Motor Holding, and now we can add another: MotoCorsa.
That’s right, the top Ducati dealer in the United States is throwing its hat into the ring, and looking to other Ducati owners to help crowdsource the $1.6 billion likely needed to wrestle away the Ducati brand from its owners at Audi AG.
I woke up this morning to a message from a colleague, with a link to a story that linked Royal Enfield to buying Ducati Motor Holding. The story was from a fairly reliable news publication, but the headline read “Royal Enfield Might Consider Buying Ducati Pretty Soon” – the grammarist in me cringed.*
“Might consider” is the most nebulous phrase in the English language. Let’s think about that phrase for a moment, as it literally means that you are considering the possibility of considering something. Don’t get me started on the timeliness of “Pretty Soon” in the news realm, as well.
Metaphysics and meaningless headlines aside, for our purposes this narrative devolves further in that this story offers nothing new, beyond the story that Reuters published two weeks ago, which set off alarms in the motorcycle industry around the world.
We have been here before, with financial news outlets discussing the possibility of Volkswagen divesting Ducati Motor Holding from its collection of companies. Let’s be clear, this talk about talk…not talk about action.
The idea of VW selling Ducati isn’t new. We first reported on this rumor back in September 2015 – when VW was found fudging around with its diesel-powered cars. Many thought the ramifications of Dieselgate would mean a bevy of brands being unload by the German car company. Nothing came of that.
Then last year, around June 2016, more talk of Ducati’s divestiture came to the forefront. The rumors were so strong, that Audi AG (the direct owner of Ducati) had to publicly state that the Italian motorcycle brand wasn’t for sale.
So here we are today, again with reports that the highest levels of Volkswagen are considering looking into selling their little motorcycle brand.