Volkswagen chief Matthias Mueller pledges revamp

Volkswagen chief executive Matthias Mueller is pushing forward with a technological and organisational revamp of Europe’s largest carmaker despite internal opposition and expects his efforts to begin bearing fruit in two to three years.
Volkswagen chief Matthias Mueller pledges revamp

“Some believe this will pass eventually, that Mueller will only be there for five years, then there’s a new boss and when the emissions crisis is over, we’ll be doing better anyway,” Mr Mueller told reporters.

“That’s not the case. Regardless of the emissions crisis, this company must reform itself and align for the future,” he said.

VW’s management board is working on about 60 projects to overhaul the German automaker, including a cultural shift to get the company’s 12 brands and numerous divisions to cooperate, as it retools for technological change and seeks to recover from the diesel-emissions cheating scandal, Mr Mueller said at a briefing in Hamburg.

The diesel-engine manipulation scandal that erupted last September pushed Volkswagen to accelerate a reorganisation it was preparing amid a broad industry shift toward electric vehicles with new digital features like automated driving.

VW invested $300m (€268m) in ride-hailing app Gett this year and is establishing a business unit focusing on new mobility offerings to expand beyond traditional manufacturing and selling of cars.

Cutting costs to revive profit at VW’s namesake brand, the company’s largest division by volume, is crucial for Mr Mueller’s strategy for the next decade, along with a reset of its operations in the US.

Sales in North America tanked in the wake of the diesel-engine manipulation, which involves about 11 million cars worldwide.

VW, which plans to introduce more than 30 electric cars by 2025 as production costs drop, anticipates sales of as many as 3 million battery-powered vehicles per year.

Mr Mueller is struggling to shift a mammoth organisation with 610,000 employees — more than any other carmaker — centralised decision-making and a shareholder structure with various competing interests.

Mr Mueller, who would face opposition from the firm’s powerful labour leaders to job cuts, said he’ll reduce headcount through natural attrition.

Bernd Osterloh, works council chief and supervisory board member, told Deutsche-Presse Agentur last weekend that there will be no forced layoffs on his watch.

VW has set aside about €17.8bn so far for fixing the affected cars and related legal risks. “We have the whole world at our throats,” Mr Mueller said.

“We hope that it will come to a good end. Well, it’s not a good end anyway; it’s super expensive.”

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