VW board to decide on new HR chief at Friday meeting

Volkswagen Lavida Plus
Volkswagen Lavida Plus

13 April, 2018

Volkswagen is poised to replace chief executive Matthias Mueller with Mr Herbert Diess, the head of its core VW brand, two people familiar with the matter said.

The management reshuffle could affect other senior VW executives, a source told Reuters on Wednesday.

Volkswagen replaced Mueller after he failed to refocus the group's portfolio of auto brands, a key pillar of "Strategy 2025" to transform the company into a leader in cleaner cars after the diesel emissions scandal of 2015.

Volkswagen is more complex than most of its peers, with the Porsche-Piech families de-facto controlling the manufacturer and the state of Lower-Saxony - home to the company's headquarters and VW's main factory - owning 20 per cent.

Mr Diess joined VW from German rival BMW in mid-2015, shortly before the scandal erupted publicly.

Dieselgate has cost VW more than 25 billion euros ($31 billion) in buybacks, fines and compensation, and the carmaker remains mired in legal woes at home and overseas. "Unions and Lower Saxony together have the power to block his appointment". The new structure, in which Diess plans to hold on to his leadership of the important VW brand, would comprise a mass market, premium, high-end sports cars and commercial vehicles unit. Excessive spending and poor budget discipline were eroding profit margins even before the carmaker's diesel-emissions scandal erupted in September 2015.

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The Tiangong-1, measuring 10 metres long and weighing around 8.5 tonnes, was launched on September 29, 2011. Tiangong-1 is a prototype space station, the first such initiative, launched by the Chinese Government.

The automaker's share price has since recovered, but some lawsuits are still pending.

Volkswagen on Tuesday said Mr Mueller had expressed his general willingness to participate in a management overhaul, and it was still to be determined whether efforts to develop a new leadership structure would leave him in place.

"The range of tasks at group level, with its many brands, legal risks and political influence, makes the new assignment incomparably more complex", Speich said, adding that there is no guarantee reforms would become easier to push through. His contract is due to run until 2020.

Mueller had "signalled he was open to play a part in the changes" in conversations with supervisory board chief Hans Dieter Poetsch, the company said in a statement.

"There have been historic episodes where cost cutters have been brought in to sort out the namesake VW brand, but who then leave or are squeezed out before their work is really done", Sanford Bernstein analyst Max Warburton wrote in a note.

VW brand chief Herbert Diess presented the I.D. Buzz Concept vehicle in Detroit on Monday.

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