World

VW Group appoints Herbert Diess as new CEO

VW Group appoints Herbert Diess as new CEO

German auto giant Volkswagen on Thursday named Herbert Diess as its new chief executive, replacing Matthias Mueller, as the one-time paragon of German industry seeks to turn the page on the "dieselgate" emissions scandal that has dogged it since 2015.

Diess answered questions at VW group headquarters in the German town of Wolfsburg, saying he will pool the company's 12 brands into three automotive groups and a truck business, while signalling that some businesses may be sold.

The move to replace Muller is also part of wider business restructure that will see the company and its brands - VW, SEAT, Skoda, Lamborghini, Bugatti, Audi, Bentley and Porsche - split into three pillars: Volume, Premium and Super Premium.

The plans were announced after Volkswagen board of directors ousted Matthias Mueller as CEO and discussed ways to overhaul the company, which spans motorbikes, buses, trucks and passenger vehicle brands including Ducati, Bentley, Porsche, Audi, Scania and Skoda. Mueller had been tapped as CEO unexpectedly in September 2015 when Martin Winterkorn resigned over the scandal in which the company had rigged carts to cheat on U.S. emissions tests.

Dieselgate has so far cost VW more than ß25-billion (R370-billion) in buy-backs, fines and compensation, and it remains mired in legal woes at home and overseas.

Volkswagen has overhauled its senior management with chairman Matthias Müller stepping down with immediate effect to make way for his successor Dr Herbert Diess.

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But he has himself landed in prosecutors' sights over suspicions he may have known about the diesel cheating before it became public and failed in his duty to inform investors. Inquiries about the diesel VW scandal is still going on.

Board chairman Hans Dieter Poetsch said the departing Mr Mueller had done "outstanding work" at a time when the company "faced the greatest challenge in its history".

Volkswagen shares declined 0.5 percent to 175.78 euros as of 11:30 a.m.in Frankfurt, reversing a gain earlier in the day.

The carmaker remains mired in legal woes overseas and in its home market, where it also faces looming diesel bans in some smog-clogged inner cities that have already depressed resale prices to the chagrin of millions of motorists.

VW said that Diess will oversee group development and vehicle IT while Rupert Stadler will handle group sales, Oliver Blume group production, company IT by Frank Witter, and procurement and components will be combined into one entity. He helped steer the company out of its diesel emissions scandal and into a new era of investment in electric cars.


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