Tuesday, November 23, 2021
Power struggle in the supervisory board
VW boss Diess is threatened with demotion today
Herbert Diess wants to consistently realign the VW Group. If this does not succeed, the CEO threatens to make severe cuts. The workers’ representatives see this as an attack on their power and ask the question of leadership that is to be decided today.
In the dispute over the future of Volkswagen Group CEO Herbert Diess, a decision is getting closer. According to reports, according to information from the Frankfurter Allgemeine Zeitung (FAZ), the Presidium of the Supervisory Board will meet today to discuss whether and, if so, under what conditions further cooperation with the manager is possible. It is becoming apparent that further responsibilities could be withdrawn from Diess as part of a compromise, but that he should keep his position at the top of the group. Volkswagen did not confirm such reports.
On December 9th, the supervisory board wants to decide on investments worth billions and the occupancy of the plants for the next few years. This is not possible without having clarified the management issue in the group by then, according to a report. “At the moment it looks like the threads are coming together,” said a person with knowledge of the advice to the Reuters news agency. The goal is a total package of several board memberships, employment prospects for the employees and investment commitments for the coming years, explained two other initiates. This could renew the truce that had enabled Diess to remain at the top of the group a year ago after the turbulence surrounding a contract extension he had requested.
Most recently, the power struggle at Volkswagen between Diess and the works council over possible cuts in the workforce and the manager’s leadership style broke out again. The works council accuses him of failing to comply with the commitments made when the contract was extended in July to coordinate more closely with the employees. Comments by Diess about the possible shedding of up to 30,000 jobs had caused concern if the transformation did not succeed. Workers recently said that trust in Diess had been massively damaged. The next few weeks will show whether it is irreparable.
Power growth for Brandstätter
The works council criticizes that Diess does not involve the workforce enough in its conversion plans. IG Metall, which is strongly represented at Volkswagen, also expresses doubts about Diess. “A coach who has no access to the team loses the game on the pitch,” said IG Metall boss Jörg Hofmann at the works meeting on Thursday. Most recently, Lower Saxony’s Prime Minister Stephan Weil also indicated that he was no longer fully committed to Diess. In the 20-member Volkswagen Supervisory Board, the support for the CEO is waning. Diess continues to receive support from the main shareholder Porsche SE, through which the Porsche and Piech families hold a good 53 percent of Volkswagen.
According to the FAZ, a solution has recently emerged in which VW brand boss Ralf Brandstätter could emerge as the winner of this new round of the conflict. According to the newspaper, Brandstätter, who is popular among employee representatives, is to become a member of the Group’s executive board. In addition, according to supervisory board circles, consideration is being given to giving him responsibility for the volume group of the group – i.e. responsibility for the mass brands VW, Skoda and Seat. Until now, Diess was responsible for this on the group’s board of directors.