Published: Sun, April 15, 2018
Money | By Hannah Jacobs

Mueller out, Diess in at Volkswagen's top tier

Mueller out, Diess in at Volkswagen's top tier

Volkswagen, which is working on a management overhaul that sources say could see it replace Chief Executive Matthias Mueller, is also planning to install a new head of human resources, Germany's Spiegel magazine reported on Tuesday.

Chief Executive Matthias Mueller is set to be replaced by VW brand boss Herbert Diess after failing to refocus the group's portfolio of vehicle brands, ranging from Skoda to Lamborghini.

64-year-old Mr Mueller, always a reluctant CEO who had grown tired of the regular grillings by board members, responded during the talks by signalling he was prepared to step aside, they said. Mr Diess joined VW from German rival BMW in mid-2015, shortly before the scandal erupted publicly.

Diess currently heads the firm's namesake Volkswagen division, but now takes over a larger parent company that owns brands including Porsche, Audi, Bentley, Bugatti and Lamborghini.

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.

At recent public events, the CEO has appeared strained and prickly, a contrast to his previous persona as the easygoing boss of the Porsche auto brand - the job he held before being tapped for CEO in the chaotic days following the cheating revelations in September 2015.

The statement said Mueller "showed his willingness to contribute" to the changes, but stopped short of saying whether Mueller was leaving his current job.

If Mueller did such a good job under hard circumstances, why change horses in midstream?

Mueller, 64, was head of Volkswagen's richly profitable Porsche division when he unexpectedly was handed the CEO job in September 2015.

Continuing, Reuters reports: "But the persistent tug of war between its controlling families, unions and other stakeholders have made it hard to drive through structural changes that investors have said are key to the company fulfilling its potential". Matthias Mueller steps down as chairman of the board of management by mutual agreement, effective immediately.

A separately listed trucks and bus business could have a market value of up to 30 billion euros ($37 billion), Evercore ISI analysts have said.

The move comes after Europe's largest automaker has been hampered by infighting among its powerful stakeholders, which include the Porsche and Piech families, the German state of Lower Saxony, and labour leaders. Now, he's poised to take VW's top job. Mr Mueller told German magazine Der Spiegel in March that he "doesn't like politicians meddling with my business", likening a discussion about a salary cap for executives to the oppressive system of the former German Democratic Republic.

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