Volkswagen CEO Forced Out After Clashes With Union Bosses

Volkswagen CEO Herbert Diess – who took over at the end of the company’s “diselgate” scandal, before steering the German carmaker into a massive multibillion-euro foray into electric vehicles – is stepping down and will leave the company within weeks after being forced out by union bosses, the Financial Times reports.

Diess had made it his mission to catch up with Tesla and become the world’s largest electric car producer by the middle of the decade. He oversaw the launch of VW’s first all-electric cars and committed to spend €52bn on developing battery-powered models, while imposing big cost cuts. -FT

Replacing the 63-year-old will be Porsche boss and former VW manager, Oliver Blume, who will take over on September 1st.

Diess ran into trouble after crossing Volkswagen’s powerful German works council, which represents some 300,000 workers, and controls half of VW’s supervisory board. According to works council leader Daniela Cavallo, the group fought to ensure that “job security and profitability remain equally important corporate goals in the coming years.”

“Our focus as an employee organisation is clear: all our colleagues must be involved. Today’s decisions pay tribute to this.”

In late 2021, the VW works council issued a vote of no confidence in Diess, pointing to his suggestion that the company needed to cut 30,000 jobs, as well as his decision to cut Cavallo out of an investors’ meeting in the US – one of many inflammatory actions they say Deiss committed against the union.

“Herbert Diess played a key role in driving forward the transformation of the company,” said Hans Dieter Pötsch, chairman of the board, thanking Diess for pushing the company towards EVs.

“After a really stressful first half of 2022 many of us are looking forward to a well-deserved summer break,” he said.