Economy

Volkswagen considering replacing CEO Mueller with brand chief Diess amid shake-up

Volkswagen considering replacing CEO Mueller with brand chief Diess amid shake-up

Volkswagen's board abruptly ended the tenure of Chief Executive Officer Matthias Mueller, a caretaker who revived the carmaker after its worst crisis on record, turning instead to a leader who can implement deeper changes, people familiar with the matter said.

Diess was regarded as a potential future CEO when he joined Volkswagen in July 2015 after serving as head of vehicle development for BMW.

Mueller, a company veteran, was installed at short notice in 2015, a week after the company admitted to cheating USA diesel emission tests, prompting criticism from some investors who said that only an outsider could rebuild trust in the business.

Volkswagen said that talks were "currently open" and that Mueller "showed his willingness to contribute" to the changes. German newspaper Der Spiegel has reported that the changes could take place as soon as Friday.

Shares in Volkswagen jumped on the news, and closed up 4.5 percent at 171.58 euros.

The news emerged at the same time as speculation surrounding the company's executive leadership, with Volkswagen admitting that it's considering changes at the top in a short statement released on Tuesday. The scandal has cost the company over $30 billion.

Further details are emerging over an expected management shake-up at German vehicle giant Volkswagen AG, ahead of a supervisory board meeting expected on Friday.

The statement added: "It is now open whether the considerations and discussions will lead to a further development of the management structure or to personnel changes".

The issue with restructuring VW lies with a tug a war between interested parties including the controlling families, stakeholders, and unions.

News of replacing Mueller moved shares upward. Muller's dismissal comes despite the company's strong performance last year which saw profits of €17bn (£14.8), a 16 per cent increase on the year before.

"We see no better alternative to Matthias Mueller to make the company fit for the future".

Volkswagen chose not to comment on Handelsblatt's information. The works council, whose members occupy half the seats on the supervisory board, also declined comment.


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