Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: THURSDAY, July 29, 1993 TAG: 9307290034
SECTION: BUSINESS PAGE: B7 EDITION: METRO
SOURCE: Associated Press
DATELINE: BERLIN LENGTH: Medium
Meanwhile, the GM-to-VW defector at the center of the fight was on vacation. Jose Ignacio Lopez de Arriortua, whom General Motors accuses of industrial espionage, made no statement, while his boss went on the offensive.
Piech told reporters he fully supports Lopez and GM is waging a campaign of revenge because Lopez had taken his cost-cutting and management skills to VW.
"I don't see a peaceful end to this," Piech said. "We're in a mudslinging battle and we intend to do what's necessary to win."
Piech, who took over the VW chairmanship early this year as profits melted into steep losses, has been criticized for being on vacation while the dispute over Lopez escalated. German prosecutors said they had evidence that appeared to tie Lopez to the alleged theft of GM secrets.
Last week, prosecutors in Darmstadt said they found GM papers in the home of a Lopez aide, Jorge Alvarez Aguirre, who moved to VW with him. Piech suggested the documents had been planted.
The prosecutors' office refused to comment on Piech's statement. It has lodged no charges against Lopez or aides who left GM with him.
Adam Opel AG, the German subsidiary of GM, said Piech's accusations conflicted with the results of criminal investigations so far. "The damaged party here is Opel, not VW," the firm said in a statement.
It said Piech had descended to "an astonishingly low level" and rejected the VW chairman's assertion as "completely without substance." Opel said it would hold a news conference today.
Piech referred repeatedly to the dispute as a kind of war. He said the world's automakers had capacity to build 40 million cars a year but were selling only 30 million. "There is a fight for survival," he said.
Lopez honed his skills at Opel and was GM's purchasing chief when he left for VW in March. He had drastically cut prices paid to suppliers at GM and was hired by VW to do the same. He has achieved 90 percent of a targeted $5.2 billion savings for this year, Piech said this week.
The battle between GM and VW could have wide implications, because Lopez' attacks on costs are what many economists say will save German industry, which has the most expensive costs in the world.
by CNB