Porsche Denied State, KfW Loan

Things seem to go from bad to worse for German luxury manufacturer Porsche. Having to face a 9 billion euro debt, the company has received a blow below the belt today, as German Foreign Minister and Vice Chancellor Frank-Walter Steinmeier said in an interview with Stuttgarter Zeitung newspaper that the German state will not step in and help the manufacturer with taxpayer money.

"There is no need to help here with taxpayer money," he told the newspaper, continuing by criticizing the fight which ensued between the two owners of Porsche, Ferdinand Piech and Wolfgang Porsche. The German official also targeted with his remarks the involvement of the Baden-Wuerttemberg and Lower Saxony governments, which each took the side of either Porsche or Volkswagen.

This is nothing but bad news for Porsche, as without Germany's help, the 1.75 billion euro loan for which it applied with KfW bank will not be secured. On Friday, Sueddeutsche Zeitung newspaper reported that the bank already rejected the loan application, citing the fact that Porsche did not meet the criteria for a state loan.

The loan request can still be submitted once again, yet the perspectives aren't good for Porsche. A final and official decision is yet to be made, but Steinmeier's remarks leave little room for hope. Especially because this is, after all, an election year in Germany...

Yesterday, Porsche's CEO, Wendelin Wiedeking stepped in and criticized two of the board members - Bertold Huber and Ferdinand Piech - for publicly expressing their concerns regarding Porsche's finances.