VW GROUP

Herbert Diess almost loses his job

Everything indicated that Herbert Diess, the CEO of the Volkswagen Group, would be removed from his position. The tendency of this German manager, coming from BMW after the Dieselgate scandal, to draw attention to the group's difficulties and needs has made him less and less popular, not only with the Porsche and Piech families, who control most of the votes in the administration, but also in the union, worried about the possibility of redundancies due to industrial options associated with electric mobility. But last Friday, a last-minute turnaround meant that Diess could continue as the head of Volkswagen AG, despite being stripped of powers again, according to Reuters.

The VW Group was, among the traditional manufacturers – those who have always made a living from the production of vehicles with combustion engines and with profit margins capable of calming the spirit and portfolio of its shareholders – which invested more decisively in electric vehicles. From specific platforms for battery-powered models to modified factories for the production of this new type of vehicle, the group, through its immense range of brands, did not spare efforts or investments.

But six years after starting this adventure at the company, Diess, who was hired because he was clear of suspicion about the scandal of handling diesel engines, had to deal with the less good options of the German giant.

The last battle was aimed at reducing production costs, when the CEO came to the conclusion that VW needed to be faster and cheaper to manufacture its models, compared to more efficient competitors. This would only be possible with large industrial investments, reformulation of platforms and a considerable reduction in the number of workers on the production line. It is exactly this that has the unions on the verge of a nervous breakdown, demanding the CEO's removal.

According to Reuters, a compromise was reached, in which Herbert Diess retains the position of CEO, but deprived of most of the powers, limiting himself to strategy. The management of the group is transferred to Ralf Brandstätter, who thus accumulates responsibility for the VW brand.

This is not the first time that Diess has been “relegated” within the group, a situation that is surprising given the treatment that the German conglomerate has always given to the previous CEO, of the group and of the different brands, even those who caused tremendous damage, not only reputational but billions of euros, as well as those associated with Dieselgate.

Autonews