Volkswagen committee to discuss future of CEO Diess
A specially convened Volkswagen (VOWG_p.DE) committee will discuss the future of CEO Herbert Diess, three people familiar with the matter said on Wednesday, a week after a longstanding conflict with labour representatives flared up again.
The planned meeting of the rarely-summoned mediation committee of VW’s supervisory board comes in response to tensions between management and its works council, after sources said Diess told a recent meeting of the board that 30,000 jobs were at risk as part of the group’s electric vehicles push.
The sources, who spoke on condition of anonymity, could not confirm when the meeting would take place.
“Constructive and confidential discussions are currently being held. Possible results will be communicated in due time,” said a source close to the supervisory board.
The mediation committee consists of Hans Dieter Poetsch, supervisory board chairman and CEO of Volkswagen’s largest shareholder Porsche SE (PSHG_p.DE); Stephan Weil, state premier of the German state of Lower Saxony, which owns a fifth of the voting rights of Volkswagen; works council leader Daniela Cavallo; and Joerg Hofmann, head of Germany’s largest trade union IG Metall.
Spokespeople for Diess, Volkswagen’s supervisory board and Porsche SE all declined to comment.
Shares in Volkswagen extended losses and fell as much as 4.7% following the news.
The escalation of the tussle over Diess’s future underscores the fragile balance of power at the world’s second-largest carmaker, pitting Diess’ ambition to make Volkswagen more competitive with Tesla (TSLA.O) against Germany’s influential trade unions.
Diess, who took the helm at the carmaker in 2018 as the third CEO since the Dieselgate emissions scandal broke in 2015, has been repeatedly criticised for his demanding management style as he seeks to overhaul the company.
His current contract, extended early during the summer, runs until October 2025.
Diess, 63, has been singling out Tesla’s success as a benchmark for Volkswagen, hailing the efficiency and lean management of entrepreneur Elon Musk’s company, which has drawn the ire of labour representatives who fear this will lead to major job cuts.
Underscoring his admiration for Musk’s achievements, Diess even invited him to address 200 VW executives via a video call during a recent company meeting.
When Volkswagen released lower-than-expected third-quarter results last week, Diess said that headcount reduction was needed to make Volkswagen competitive with regard to fast growing EV rivals.