End in sight for consensus

by Stuart Penson

Commentators up and down Germany are writing the obituary of a faithful old friend: the consensus-based economy.

After decades of success, a uniquely German system of cooperation between industrialists, bankers, politicians and sometimes even trade unionists is falling apart in the face of increased global competition and the power of international shareholders.

That, at least, is the argument splashed over the newspapers here as the country grapples with the hostile takeover bid by the UK’s Vodafone for industrial group Mannesmann, and the insolvency of construction giant Holzmann.

The Mannesmann bid in particular has unleashed a torrent of rhetoric from left and right.

`Mannesmann must not become a subsidiary of a London company,’ said Nordrhein-Westfalen minister Wolfgang Clement. Another regional politician added: `Hostile takeovers don’t fit with the social market economy or the corporate culture.’

But away from the rhetoric, hundreds of German companies have slipped quietly into foreign hands. Nowhere is the trend more evident than in the automotive components industry, where US companies started buying German manufacturers some time ago.

Delphi, Lear and Visteon have already acquired dozens of specialist German firms and among original equipment manufacturers, rumours of interest in BMW from Ford have been circulating for several months.

The car industry is, of course, the scene of Germany’s biggest commitment to the global market – DaimlerChrysler. `The fusion of Europe’s second biggest industrial concern with the third biggest car manufacturer has catapulted Germans into the new dimension of the global economy,’ said one commentator.