Martin Winterkorn to Stay Volkswagen CEO with 3-Year Contract Extension

Martin Winterkorne
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Volkswagen’s supervisory board has proposed extending Martin Winterkorn’s term as chief executive officer until the end of 2018.

With Winterkorn locked in to the CEO position, analysts are hoping this means Volkswagen will be looking externally for a new chairman. The prior holder of the position, Ferdinand Piech, was known for maintaining the balance of power between worker representatives and shareholders. He had to leave following repeated clashes with Winterkorn over the company’s strategy. Eventually, the Lower Saxony representatives and labor representatives, both of whom supported Winterkorn, banded together to remove Piech in April.

It is hoped that any new chairman will be able to work with Winterkorn to address some of the company’s current challenges, such as the profitability of the core VW brand. One person identified as a possible candidate was Hans Dieter Poetsch, the Chief Financial Officer. A spokesman has said that a permanent chairman will be decided by the end of the year. Currently, former union leader Berthold Huber is serving as interim chair.

With the backing of key members on the board, Winterkorn has been working to overhaul Volkswagen’s corporate structure to be more decentralized. The intent is to use holding companies to boost the overall profits. Other elements of the strategy aim to raise productivity without needing to cut jobs in the Lower Saxony area where Volkswagen’s headquarters are located.

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Source:
VW’s CEO Winterkorn Set to Stay on for Three More Years,” Reuters web site, September 2, 2015.

 
 
 
 

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