Volkswagen's CEO is out following diesel scandal

Volkswagen's CEO is out following diesel scandal

The company said Tuesday that it "considers a further development of the management structure of the group" and that "this could include a change in the position of the chairman of the board of management", the German term for CEO.

Originally contracted to serve until 2020, Mueller was stepping down "by mutual agreement, effective immediately", VW said in a statement.

Volkswagen Group, the world's largest automaker by sales volume, has appointed a new CEO to replace the executive who helped steer the company out of its diesel emissions scandal and into a new era of investment in electric cars.

Mr Mueller, a company veteran, was installed at short notice in 2015, a week after the company admitted to cheating United States diesel emission tests, prompting criticism from some investors who said that only an outsider could rebuild trust in the business. The settlement was approved by a federal court in California on October 25, 2016, with the company paying paying $2.9 billion into an environmental mitigation trust fund to be shared among the states and tribes.

Mueller had attempted to right the ship after VW admitted to installing software in 11 million diesel vehicles worldwide created to cheat regulatory emissions tests.

It's perhaps Herbert Diess's most attractive trait to the Volkswagen supervisory board at the moment that he's no single-company career man like you'll find in other German carmaker board rooms.

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VW's power structure rests on close ties between management, workers and politicians from Germany's northwestern state of Lower Saxony, where VW is the largest private-sector employer with over 100,000 workers at six factories.

And while he brought VW's share price and profits back up to pre-crisis levels, observers say he made little progress in shaking up the firm's famously hierarchical corporate culture, which some critics believe discouraged employees from speaking up about the diesel scam. He got the job "when the company faced the greatest challenge in its history".

Yet, he was present in the room on the fateful day when the company's top managers were informed in detail about the depth and breadth of the cheating scandal.

Volkswagen surprised markets earlier this week when it revealed it was considering reshuffling its board and replacing Mueller.

The appointment of Diess comes as VW investors are clamoring for increased profitability. But how about all the other cars that are more than a year old? But when Winterkorn fell, he had been with Volkswagen for less than three months.

"In a phase of profound upheaval in the automotive industry, it is vital for Volkswagen to pick up speed and make an unmistakable mark in e-mobility, the digitalization of the automobile and transportation as well as new mobility services", Diess said in the announcement.




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