Volkswagen Group Prepares to Appoint a New CEO
Porsche chief Matthias Mueller is said to be the front runner to take over as Volkswagen's new CEO. A decision is expected to be announced on Friday. Source: Volkswagen Group.
Volkswagen Group is expected to get a new CEO on Friday. Reports from Europe on Thursday suggest that Matthias Mueller, currently head of the Porsche brand, will likely get the nod to take over the top job at the giant German automaker.
Mueller -- or whoever is selected -- will take over the role vacated on Wednesday by longtime VW executive Martin Winterkorn, who was the first casualty of an emissions-cheating scandal that has cut VW's market cap by a third, and made the automaker the focus of investigations by governments all over the world. But he's likely to have a lot of company in the unemployment line soon.
A slew of firings as the accusations and lawsuits beginReuters reported on Thursday that Volkswagen's supervisory board will likely fire several top executives when it meets on Friday. Those at risk, according to the report, are Michael Horn, VW's top executive in the United States, and Ulrich Hackenberg and Wolfgang Hatz, the research and development chiefs of the Audi and Porsche brands, respectively.
Hackenberg and Hatz are both engineers, and both had held senior posts in VW's engine-development unit before being promoted into their current roles. Heinz-Jakob Neusser, the development chief for the VW brand, may also be fired, the report said.
Their successors, and VW's new CEO, will have an enormous job in front of them.
The repercussions of this scandal continued to grow on Thursday. Government regulators in a rapidly growing list of countries are opening investigations -- India and Japan joined the list on Thursday -- and criminal investigations are underway in the U.S.
Government officials aren't the only ones seeking redress from VW. Several class-action suits on behalf of outraged owners have already been filed in the United States, seeking compensation for lost resale value, and VW's false claims about its "clean diesel" technology.VW's U.S. dealers might soon join them.
VW's U.S. dealers may be gearing up to sue, tooThe dealers are upset because they're suddenly stuck with a whole lot of cars they can't sell. The Environmental Protection Agency has refused to certify VW's diesel models for sale in the U.S. until it comes up with a fix for the software that allows the cars to pass emissions tests while producing illegally dirty exhaust in real-world driving.
That affects a lot of cars currently sitting on dealer lots. Until last week, diesels represented between 20% and 25% of VW's U.S. sales in any given month.
That means that VW's U.S. dealers are stuck with a lot of cars they can't sell -- many of which were financed. VW is offering the dealers financial assistance in an effort to tide them over, but many dealers say it isn't enough, according to a report in Automotive News. Those dealers are considering legal action.
It's still hard to even guess the cost of this messIf you read the above, and thought it was a bit overwhelming, you're right. That's why it's still hard to even guess how much this mess is going to end up costing Volkswagen.
The company said on Tuesday that it would take a 6.5 billion euro ($7.3 billion) charge in the third quarter to repair the 11 million affected cars, and deal with the repercussions of the scandal. It's a huge sum, but it's looking more and more likely that it won't be enough.
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