Volkswagen Appoints Ralf Brandstaetter As VW Brand CEO
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Volkswagen replaced Herbert Diess as chief executive of the VW brand on Monday and installed chief operating officer Ralf Brandstaetter to lead cost-cutting efforts at the company’s largest plants in Germany.
The management reshuffle comes after weeks of squabbling between Volkswagen’s powerful labor leaders and managers over the pace and scale of cost-cutting plans to free up resources for a radical shift toward electric cars.
Volkswagen said Brandstaetter would take over on July 1 to give Diess, who remains group chief executive, more leeway to run the rest of the company, which includes brands such as Audi, Bentley, Skoda, Lamborghini, and Porsche.
Herbert Diess to continue to hold his position as the Chief Executive Officer of the Volkswagen Group
“Ralf Brandstaetter is one of the company’s most experienced managers,” Diess said in a statement. “I am therefore very pleased that Ralf Brandstaetter will be forging ahead with the development of the brand as CEO.”
Volkswagen said Diess retained overall responsibility for Volkswagen passenger cars and that the management reshuffle would also result in the departure of procurement and components chief Stefan Sommer.
Sommer joined VW in 2018 and oversaw ambitious procurement plans, including the construction of large factories to power Volkswagen’s ambitious electrification shift as the carmaker encountered supply bottlenecks.
Earlier on Monday, sources told Reuters that Volkswagen’s supervisory board was hosting an extraordinary meeting to discuss replacing Diess as CEO of the VW brand.
Diess is trying to get the company’s powerful labor leaders, who control nine of the 19 seats on the supervisory board, to agree to painful cost cuts.
The savings are designed to help pay for a 34 billion euro (29.89 billion pounds) investment in electric and autonomous cars and 50 billion euros for EV battery procurement.
Diess also came under pressure after Volkswagen was forced to halt sales of its newest VW Golf model because of software glitches at a time when the company is preparing to mass-produce VW’s ID.3 electric car.
Questions & Answers
Q.What is Ralf Brandstaetter's primary responsibility in his new role as VW brand CEO?
What is Ralf Brandstaetter's primary responsibility in his new role as VW brand CEO?
He has been installed to lead cost-cutting efforts at Volkswagen's largest plants in Germany. This reshuffle aims to free up resources for a significant shift towards electric cars within the company.
Q.Why was the management reshuffle at Volkswagen considered necessary?
Why was the management reshuffle at Volkswagen considered necessary?
It followed weeks of disagreements between labor leaders and managers regarding the speed and scope of cost-cutting plans. The company needs to fund a radical shift towards electric vehicles, requiring substantial savings and investment.
Q.What was the immediate consequence for Herbert Diess after Ralf Brandstaetter's appointment?
What was the immediate consequence for Herbert Diess after Ralf Brandstaetter's appointment?
Diess retains his position as Volkswagen Group chief executive but relinquishes his role as CEO of the VW brand. This change is intended to give him more flexibility to oversee the broader company's operations and other brands.
Q.Who else departed from Volkswagen's management as a result of this reshuffle?
Who else departed from Volkswagen's management as a result of this reshuffle?
Procurement and components chief Stefan Sommer also left the company. He had joined in 2018 and was responsible for ambitious procurement plans, including building factories for the company's electrification strategy.