Last day at VW for Jose Ignacio Lopez
On November 29 1996 top Volkswagen official Jose Ignacio Lopez de Arriortua resigns from his job amidst accusations of racketeering and industrial espionage.Lopez had risen through the ranks as a purchasing executive at GM where he had pioneered what The New York Times called the most aggressive system in the world for buying auto components cheaply.(This system which reduced GMs costs and increased its profits was known as the Lopez effect within the industry.) In 1993 Lopezsupposedly miffed because GM was not moving fast enough to build a factory called Plant X that used the Lopez purchasing systemabandoned GM for Volkswagen.He brought with him more than 2 million pages of top-secret GM documents business plans pictures of new automobile designs and part and factory blueprintsinformation that GM said VW used to cut 450 million in expenses eliminating GMs competitive advantage in the European market.
(For his part Lopez denied any wrongdoing.You have the right to take your ideas away with you he insisted though in fact intellectual-property law dictates otherwise.) In mid-November 1996 VW opened a new factory in Resende Brazil that seemed to be based on the purloined plans for Plant X.For three years after Lopez left GM the American auto giant had been trying to get VW to oust Lopez and to apologize for his theft with no success.Lawsuits accused Lopez and VW of espionage racketeering and copyright infringement.
Finally in hopes that its rival would settle its suits out of court VW announced that Lopez would resign.However his resignation did not stop the criminal investigations against him.Within weeks prosecutors had filed criminal charges in German and American courts.In January 1997 VW agreed to pay GM 100 million and to buy 1 billion worth of auto parts from the American company between 1997 and 2004.
While they admitted no wrongdoing VW executives also issued a statement that conceded what they called the possibility that illegal activities might have taken place.In 1998 a German court fined Lopez 280000 and dropped all criminal charges against him.In 2001 the Spanish high court refused to extradite him to the U.S.for trial.
