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Volkswagen Set to Oust Matthias Müller as C.E.O. After Diesel Scandal - IngestMag.com
Home / Business / Volkswagen Set to Oust Matthias Müller as C.E.O. After Diesel Scandal

Volkswagen Set to Oust Matthias Müller as C.E.O. After Diesel Scandal

Volkswagen remains the target of a wide-ranging criminal investigation that has included searches of Mr. Müller’s offices. However, there has been no new revelation that would have prompted Mr. Müller to leave now, said Klaus Ziehe, a spokesman for the prosecutors in Braunschweig who are conducting the inquiry.

Widely respected for his knowledge of cars, Mr. Müller, 64, is a manager of the old school who has spent his entire career at Volkswagen and its subsidiaries. As someone steeped in the company’s top-down, engineer-oriented culture, he may have been ill-suited to lead wholesale change.

Mr. Müller was a high-ranking executive involved in product development at the same time that Audi and Volkswagen were concocting the illegal software and deploying it in vehicles. Mr. Müller also worked closely with some of the people under investigation over possible involvement in the emissions conspiracy. Even if ignorant of the wrongdoing, as he has insisted, Mr. Müller faced the accusation that he was part of a system that allowed it to take place.

In a statement, Volkswagen said it was considering “a further development of the management structure of the group,” which could “include a change in the position of the chairman of the board of management,” referring to Mr. Müller. The company said it had not yet made a final decision to replace him, but merely calling his status into question effectively sealed his fate.

Mr. Diess has a shorter history at Volkswagen but would nonetheless satisfy the company’s longtime preference for choosing chief executives from its own ranks.

The scandal, and Volkswagen’s continued vulnerability to it, came into renewed focus after The New York Times reported in January that the company had helped to finance experiments on monkeys in a bungled attempt to show that exhaust from modern diesels was benign.

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How Volkswagen’s ‘Defeat Devices’ Worked

Volkswagen admitted that 11 million of its vehicles were equipped with software that was used to cheat on emissions tests. This is how the technology works and what it now means for vehicle owners.



OPEN Graphic


The experiments, in which monkeys were forced to breathe diesel fumes at a lab in Albuquerque, caused a furor in Germany and elsewhere. Chancellor Angela Merkel condemned the research, the German Parliament debated possible consequences, and animal rights activists demonstrated outside Volkswagen’s headquarters in Wolfsburg.

Mr. Müller promised to change Volkswagen’s corporate culture to be less authoritarian and less prone to the kind of behavior that led to the emissions cheating. At the same time, he presided over a management board still dominated by people who, like himself, were products of that culture.

Critics said that, as a longtime insider, Mr. Müller lacked the credibility needed to force change within Volkswagen.

Volkswagen’s stock price rose almost 5 percent, to 172 euros, or about $211, per share, on the news of Mr. Müller’s potential departure. They are about 2 percent higher than their value when the company made its diesel admission in 2015.

The emissions scandal has had wide-ranging impacts beyond the company.

For one, it has contributed to increased wariness of diesel. The fuel had been seen as more environmentally friendly than gasoline because it emits lower levels of greenhouse gases, but it nevertheless spews out poisonous nitrogen oxides. As a result, cities across Europe have taken steps to restrict the use of diesel vehicles in urban centers, and sales of diesel cars have slowed dramatically across the region.

The diesel cheating and its aftermath has also focused attention on the tight links between Germany’s political elite and the auto industry. Carmakers employ around 800,000 people in Germany and are the country’s highest-value export. But as politicians in Berlin have refused to crack down on car companies, voters have increasingly seen them as complicit with the industry.

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News credit : Nytimes