Volkswagen has said that Herbert Diess will take over from Matthias Müller as its chief executive, adding fresh impetus to its efforts to slim down and reorganise the way its 12 brands are managed.
On Thursday, the carmaker said it planned to create six new business areas and a special portfolio for China, its largest market, and split its brands into three new vehicle groups with categories for value, premium and super-premium nameplates. The announcement was made after Volkswagen directors ousted Müller and deliberated ways to reform an empire that includes motorbike, bus, truck and passenger car brands including Ducati, Bentley, Porsche, Audi, Scania and Skoda.
Volkswagen replaced Müller after he failed to refocus the group’s portfolio of car brands, a key pillar of “Strategy 2025” to transform the company into a leader in cleaner cars after the diesel emissions scandal of 2015.
The appointment of Diess, formerly the company’s brand manager, was cheered by analysts. “Diess is a man of action. He is the most plausible choice at VW to lead the group into the next phase of its transformation,” said Nord LB analyst Frank Schwope, who has a buy rating on Volkswagen.
A VW supervisory board source told Reuters that Volkswagen was planning pool management of all its sportscar brands except for Audi under a planned revamp designed to hike profitability.
The board wants to reorganise the way that passenger car brands, trucks and buses are grouped in a bid to increase its development and engineering synergies and improve the German carmaker’s competitiveness. VW said it would hold a press conference in Wolfsburg on Friday at 8.30am BST.
Volkswagen’s deliberations come as rival carmakers and suppliers including Fiat and Daimler work on ways to slim down and divest themselves of non-core assets. Analysts at Goldman Sachs say there is £140bn worth of “hidden value” in the European auto sector that could be unlocked through portfolio simplifications.
VW supervisory board members are discussing the creation of a “super premium” group which would include sports car brands Porsche, Bentley, Lamborghini and Bugatti, the source said. Audi would be excluded from this group and form its own premium division.
In addition, there would be a “volume” group that includes the VW brand, Czech division Skoda and Spanish unit Seat and a “commercial vehicles” category.
Volkswagen will carve out a trucks and buses division that includes MAN and Scania heavy-truck brands, the source said, adding that Volkswagen’s MAN Turbo and Renk units would be put into a further division.
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