By William Maley
Yesterday, Volkswagen's supervisory board showed current CEO Matthias Müller the door and announced that Dr. Herbert Diess, the current head of the Volkswagen brand will take his place. This confirms reports earlier this week about a change in leadership.
In a statement, Volkswagen said the decision of Müller's departure was “mutual” and will be effective immediately.
“Matthias Müller has done outstanding work for the Volkswagen Group. He assumed the chairmanship of the Board of Management in the fall of 2015 when the Company faced the greatest challenge in its history. Not only did he safely navigate Volkswagen through that time; together with his team, he also fundamentally realigned the Group’s strategy, initiated cultural change and, with great personal commitment, made sure that the Volkswagen Group not just stayed on track but is now more robust than ever before. For that, he is due the thanks of the entire Company,” said Hans Dieter Pötsch, chairman of the supervisory board.
Diess' rise to CEO is surprising considering he joined Volkswagen from BMW in 2015 - just a few months before the diesel emission scandal came to light. He has made great strides in improving Volkswagen's tendency to spend money like its going out of style. This was important during the aftermath of diesel emission scandal.
“The Volkswagen Group is a union of strong brands with great potential. Matthias Müller has laid the groundwork for our transformation. My most important task will now be to join with our management team and our Group workforce in consistently pursuing and pushing forward our evolution into a profitable, world-leading provider of sustainable mobility. In a phase of profound upheaval in the automotive industry, it is vital for Volkswagen to pick up speed and make an unmistakable mark in e-mobility, the digitalization of the automobile and transportation as well as new mobility services,” Diess said in a statement.
This wasn't the only change made by Volkswagen's supervisory board yesterday. The company will reorganize their passenger car brands into three groups.
Volume: Seat, Skoda, and Volkswagen Premium: Audi Super Premium: Bentley, Bugatti, Lamborghini, and Porsche Volkswagen's truck division will go into their own separate unit.
Diess is also planning a review of all the companies under the Volkswagen group umbrella (Ducati motorcycles and Renk, a transmission maker) to see whether it makes sense to keep them.
"We've lost a great deal of trust with customers. It will be a long, rough road to gain it back," said Diess.
Source: Automotive News (Subscription Required), 2, Reuters, Volkswagen
EXTENSIVE REVISION OF VOLKSWAGEN GROUP MANAGEMENT STRUCTURE DECIDED
Apr 12, 2018
Board of Management and Supervisory Board pave the way for more efficient Group management Group will be organized into six business areas and the China region Dr. Herbert Diess follows Matthias Müller as Chairman of the Group’s Board of Management Supervisory Board thanks Matthias Müller for outstanding service New head of Human Resources and Organization – Gunnar Kilian to follow Karlheinz Blessing Dr. Garcia Sanz leaves the Company at his own request Porsche CEO Oliver Blume appointed to Group Board of Management
WOLFSBURG, April 12, 2018 – The Board of Management and Supervisory Board of Volkswagen Aktiengesellschaft have resolved to extensively revise the Group’s management structure. Volkswagen is thus systematically continuing to transform its business and establishing even more efficient Group management in a phase of highly dynamic change in the Company and the entire automotive industry. In order to sustainably implement the new structure, there will be a number of changes on the Board of Management. Matthias Müller steps down as Chairman of the Board of Management by mutual agreement, effective immediately. At its meeting on Thursday, the Supervisory Board appointed Dr. Herbert Diess as his successor.
Chairman of the Supervisory Board Hans Dieter Pötsch expressly thanked Müller for his dedication: “Matthias Müller has done outstanding work for the Volkswagen Group. He assumed the chairmanship of the Board of Management in the fall of 2015 when the Company faced the greatest challenge in its history. Not only did he safely navigate Volkswagen through that time; together with his team, he also fundamentally realigned the Group’s strategy, initiated cultural change and, with great personal commitment, made sure that the Volkswagen Group not just stayed on track but is now more robust than ever before. For that, he is due the thanks of the entire Company.”
The introduction of the brand groups Volume, Premium and Super Premium, along with the planned preparation for capital market readiness of Truck & Bus, create the basis for a more subsidiary leadership of the Group. The Chairmen of the Board of Management responsible for the brand groups will be taking on additional Group management roles. Following this reorganization, Herbert Diess will be responsible for Group Development and Research, Rupert Stadler for Group Sales, and Oliver Blume for Group Production.
Additional Group functions will be allocated according to the same principle. Due to the special significance of vehicle connectivity, Vehicle IT will be led by Herbert Diess himself; Company IT will be headed by Frank Witter. Procurement and Components are to be combined into one unit going forward.
The new structure streamlines Group management, systematically leverages synergies in the individual operating units and speeds up decision-making. “The Volkswagen Group’s goal is and remains to align the Company and its brands with future needs, to safeguard its position among the leaders of the international automotive industry with innovativeness and profitability and to be instrumental in shaping tomorrow’s personal mobility with the strength of our Group brands. Herbert Diess is the right manager to do that. In realigning the Volkswagen brand, he has demonstrated to impressive effect the speed and rigor with which he can implement radical transformation processes. This accomplishment makes him predestined to fully implement our Strategy 2025 in the decisive years that are now to follow,” Pötsch says.
“The Volkswagen Group is a union of strong brands with great potential. Matthias Müller has laid the groundwork for our transformation. My most important task will now be to join with our management team and our Group workforce in consistently pursuing and pushing forward our evolution into a profitable, world-leading provider of sustainable mobility. In a phase of profound upheaval in the automotive industry, it is vital for Volkswagen to pick up speed and make an unmistakable mark in e-mobility, the digitalization of the automobile and transportation as well as new mobility services,” Diess says.
At its meeting today, the Supervisory Board also decided on two new appointments to the Group Board of Management. Dr. Oliver Blume, Chairman of the Board of Management at Porsche, will belong to the Group’s top governing body going forward.
In addition, Gunnar Kilian, who until now has served as Secretary-General of the Volkswagen Group Works Council, has been appointed the new member of the Group Board of Management for Human Resources. He takes over the post from Dr. Karlheinz Blessing, who served in the role from the beginning of 2016. Dr. Blessing will be leaving the Board of Management by mutual agreement, but remains available to the Company in a consultative capacity for the remaining duration of his employment contract. Pötsch thanked Blessing for his service: “Dr. Blessing has been instrumental in realigning the Group during the past two years. He also contributed with great dedication to the evolution of the VW brand as part of the Volkswagen brand’s Future Pact.
Dr. Francisco Javier Garcia Sanz, head of Procurement, leaves the Company at his own request. “During the past two decades, Dr. Garcia Sanz has built up a cutting-edge Procurement department. His leadership of the diesel task force was instrumental in overcoming the diesel crisis. As Chairman of the Supervisory Board of the SEAT brand, he also made a significant contribution to reinforcing the brand,” said Pötsch in gratitude. Ralf Brandstätter, Board of Management member responsible for Procurement for the VW brand, will take on this additional role provisionally.
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By William Maley
The past few years at Volkswagen haven't been smooth sailing with the diesel scandal coming to light with various executives being fired or stepping down, sales taking a nosedive, and various fines. Matthias Müller who has been Volkswagen AG CEO since the scandal broke has been trying his best to get the company back on track. But that might not be enough for him to keep his job.
Bloomberg and German paper Handelsblatt have learned from sources that Müller will be stepping down as CEO on Friday. Possibly taking his place is Herbert Diess, head of the Volkswagen brand. According to Reuters, the decision will take place during a meeting of Volkswagen's supervisory board.
"Volkswagen is considering a further development of the management structure of the group which would also be associated with personnel changes in the board of management," said Volkswagen in a statement.
Reportedly, the Porsche and Piech families - the biggest shareholders of Volkswagen - were in agreement to replace Müller.
We'll keep you posted if any new developments pop up.
Source: Bloomberg, Handelsblatt Global, Reuters
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By William Maley
For a number of years, people have been saying the biggest problem with Volkswagen is they haven't “figured out the American market yet.” Even the automaker admits that it's the reason that its market share has dropped. Volkswagen has tried again and again to make some inroads into the market to no avail. But the German automaker is giving it another go.
Automotive News had the chance to do a deep dive into Volkswagen's new plan by speaking with Volkswagen Group of America CEO Hinrich Woebcken. His plan involves turning this division into an American car company - in spirit. It should be noted that Woebcken came to the U.S. as an exchange student in the seventies, something he credits for getting him interested in industrial engineering.
"I owe America, I owe Rochester, N.Y., and I owe this metal shop for how I basically went to start my adult life. We want to get more Americanized not only in our product but in our business. It's not that we're giving up on the genes of the Volkswagen brand. Volkswagens are Volkswagens. But what we recognized over the years is ... that we were too much a small-car company, too much a sedan company," said Woebcken.
This plan was sparked only a couple months into his position as Volkswagen America's CEO. During a meeting with dealers, Woebcken was introducing the three-row crossover that is now known as the Atlas. But at the time of the meeting, it was wearing the Teramont name. Dealers hated the name and wanted to have Atlas as the name. Woebcken agreed to talk with his bosses about changing the name.
"Everybody said there was no chance to convince headquarters to change the name of a regional product. It's not a big thing, I know, but it's a symbolic statement that Wolfsburg said, 'OK, the region is independent. They want to make sure the brand is getting successful in this country. Let them decide for themselves the name,' " explained Woebcken.
"It was, in terms of Volkswagen, a pretty big thing that demonstrates ... that this is really an independent company here in America, that the factories report to us, the engineering centers in California and Detroit report to us, the purchasing organization — which is a big leverage for the cost situation — is reporting into the North American region, plus, of course, all the sales and marketing. So we really have all the levers in our hand now, not only to listen to the demands of the market, but really also to implement them."
Some of the parts of Woebcken's plan have come to fruition including cutting the prices on various models like the Tiguan and introducing a new 6 Year/72,000 Mile warranty.
Other parts of Woebcken's plan include,
Shortening Volkswagen's long product cycles with plans to “introduce two new cars every year” to North America Localize part sourcing for their two North American plans in Chattanooga, TN and Puebla, Mexico Roll out Volkswagen's electrification strategy beginning in 2020 with the I.D. Crozz It is an ambitious plan but it seems to be paying off somewhat. Sales in 2017 rose 5.2 percent. In 2018, sales are up 5.8 percent.
We highly recommend checking out this piece by Automotive News as we are only scratching the surface.
Source: Automotive News (Subscription Required)
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By William Maley
A moment of silence for the 1.4L MultiAir four-cylinder that powered the Fiat 500 since its launch 2012 as it will not be appearing in the 2018 model. Instead, Fiat has slipped in the turbocharged variant of the 1.4 into all 500s (aside from the Abarth). This boosts power from 101 horsepower and 97 pound-feet of torque to 135 and 150 respectively. A five-speed manual and six-speed automatic are the transmission choices. Other mechanical changes include upgraded brakes and a sportier suspension tune.
Pop and Lounge models become slightly aggressive outside with a new body kit, 16-inch wheels, fog lights, and 'Turbo' badge on the rear. The other key change is a backup camera being added to all 500s.
No word on pricing, but Fiat will open the order books this month with deliveries taking place in the second quarter.
Press Release is on Page 2
FIAT Brand Introduces All-turbo 500 Lineup for 2018
All 2018 Fiat 500 models now come standard with 1.4-liter MultiAir Turbo engine and 33 percent more horsepower than last year’s model 2018 Fiat 500 Pop and Lounge offer standard performance braking system and suspension, ParkView rear backup camera, sport spoiler and additional exterior upgrades High-performance, track-ready 2018 Fiat 500 Abarth models deliver up to 160 horsepower and 183 lb.-ft. of torque Customers who purchase or lease a Fiat 500 Abarth also receive – for no additional charge – a one-day high-performance driving session at the legendary Bob Bondurant School of High Performance Driving Dealers can order 2018 Fiat 500 vehicles this month, with cars arriving at FIAT studios in the second quarter 2018 FIAT product lineup also includes the fully electric 500e, functional 500L, all-wheel-drive small crossover 500X and the 124 Spider roadster February 8, 2018 , Auburn Hills, Mich. - The Fiat 500 lineup goes all-turbo for 2018, with the 1.4-liter MultiAir Turbo engine and a sportier appearance now standard on all models.
“With an all-turbo lineup, the iconic Fiat 500 now offers an even more dynamic driving experience and more standard horsepower than any of its competitors,” said Steve Beahm, Head of Passenger Car Brands – Dodge, SRT, Chrysler and Fiat, FCA – North America. “In fact, the entire FIAT brand lineup now comes standard with turbocharged power, adding to our roster of fun-to-drive, Italian-designed vehicles.”
The 2018 Fiat 500 lineup is available in three models: Pop, Lounge and the high-performance Abarth. Pop and Lounge models now come standard with the 1.4-liter MultiAir Turbo engine, which features a single turbocharger, twin intercoolers and a sport-tuned exhaust, and delivers 135 horsepower and 150 lb.-ft. of torque – 34 more standard horsepower than last year’s model. The MultiAir Turbo engine is paired with a five-speed manual transmission as standard and is available with a six-speed automatic transmission.
Pop and Lounge models are also updated with standard 16-inch aluminum wheels, performance braking system, sport suspension and ParkView rear backup camera. Exterior updates include body-color front and rear fascias, side-sill ground effects, a sport spoiler, fog lamps and “Turbo” badging on the liftgate.
On the Fiat 500 Abarth models, the track-tested 1.4-liter MultiAir Turbo engine delivers up to 160 horsepower and 183 lb.-ft. of torque; while Abarth-tuned hardware offers a world-class ride and track-ready durability.
Other unique Abarth features include a performance suspension; three-mode electronic stability control with an innovative torque transfer control (TTC) system that maximizes throttle performance during on-throttle cornering; 16-inch Hyper Black aluminum wheels; and Pirelli tires with red brake calipers. An Abarth-designed concentric “double-tip” dual-exhaust system delivers a high-performance look with menacing Abarth-tuned sound.
Inside, distinctive Abarth-styled front performance seats feature a one-piece design with large side bolsters, a racing-harness pass through, accent stitching around the perimeter and integrated side-thorax air bags. Below the instrument panel, Abarth-designed aluminum pedal covers feature Nero (black) rubber trim for a decidedly racing look.
Should the driver choose to switch to Sport mode in a Fiat 500 Abarth, the turbo-boost gauge, mounted left of the instrument cluster, illuminates “Sport” and an up-shift light integrated in the cluster alerts the driver when engine speed is approaching the redline, giving the immediate feedback needed on the track or during high-performance driving.
Customers who purchase or lease a Fiat 500 Abarth also receive – for no additional charge – a one-day high-performance driving session at the legendary Bob Bondurant School of High Performance Driving.
The 500 lineup also features three new colors for 2018 (late availability) – Brillante Red, Mezzanotte Blue Pearl and Vesuvio Black Pearl – for a total of 11 exterior paint color choices. Any 2018 Fiat 500 model is also available as a Cabrio, delivering open-air freedom across the 500 lineup. 2018 Fiat 500 vehicles are available to order this month, with cars arriving at FIAT studios in the second quarter of this year.
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By William Maley
Diesel is quite popular in Europe partly due to subsidies provided by governments - in this case, a lower tax rate on diesel fuel than gasoline. The thinking at the time was diesel engines burn their fuel more efficiently than gas engines, thus they contribute less to global warming. But as the Volkswagen diesel emission scandal would reveal, diesel vehicles aren't that much cleaner, producing more nitrogen oxide emissions than their gas counterparts. Now, one CEO from a German automaker is saying that maybe it is time to end the subsidies.
“We should question the logic and purpose of diesel subsidies. The money can be invested more sensibly to promote more environmentally friendly technologies,” said Volkswagen CEO Matthias Müller to German paper Handelsblatt.
This is quite the surprise as Volkswagen along with other German automakers said diesel still had a future due to new pollution reduction technologies. Also, Volkswagen did very well with the sales of diesel models. But with the dark cloud of the diesel emission scandal, Müller likely sees the writing on the wall and wants to get out ahead.
Müller went on to say that he was in favor of banning older diesel vehicles from city centers. But he said that newer diesel vehicles should be exempt from the bans as they meet "stricter standards on nitrogen oxide emissions".
Source: Handelsblatt via New York Times
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