BERLIN — Volkswagen’s chief executive, Herbert Diess, won fresh backing from the automaker’s supervisory board on Thursday, but his …
BERLIN — Volkswagen’s chief executive, Herbert Diess, won fresh backing from the automaker’s supervisory board on Thursday, but his responsibilities will be pared as the company seeks to win back investor confidence lost in recent weeks over a dispute about his leadership style.
As part of a compromise deal reached with Mr. Diess, 63, more authority will be handed to Ralf Brandstätter, 53, who last year took over as head of the Volkswagen brand. Mr. Brandstätter, will join the board andbegin managing the company’s business in China from Mr. Diess next summer. China is Volkswagen’s most important market outside of Europe, but the company has struggled to gain a toehold in the market for electric vehicles.
Mr. Diess, however, will take on a new role as head of the company’s software unit, Cariad, which the carmaker views as essential to its future success.
“We have made important decisions and found good answers to make Volkswagen fit for the future,” the board chairman, Hans Dieter Pötsch, told reporters afterward. He also apologized to shareholders for the uncertainty caused by the latest round of speculation about leadership at the company. VW’s stock price has fallen more than 20 percent over last six months.
Mr. Diess said the review of executive responsibilities “was an intensive process, and I am grateful that Mr. Pötsche did not lose his patience.”
“But I think it was a good process,” he added, “and at no time did I lose my motivation. The company is very important to me.”
A crippling global shortage of semiconductors has slowed VW’s production lines, causing a 24 percent drop in third-quarter deliveries and a sharp fall in profit. Many workers have been stranded in temporary furloughs that were introduced to prevent layoffs during the pandemic but have been extended by the company.
For months, Mr. Diess had been stressing the gap in efficiency between Volkswagen and Tesla, which he pointed out aims to assemble a car in just 10 hours at its new plant under construction outside Berlin, compared to nearly twice as long at some VW plants. He recently also invited Tesla’s chief, Elon Musk, to a discussion at a company retreat.
The focus on the new rival automaker angered many Volkswagen’s employees, already frustrated over their inability to produce as many vehicles as they could because of the parts shortages.
In perhaps a sign that Mr. Diess understood that all the references to Tesla were bothering people in Wolfsburg, where Volkswagen has its headquarters, he referred to the company during Thursday’s news conference as “an American competitor building a plant in Grünheide,” — the location of Tesla’s nearly completed new factory — but refused to state the company’s name, even when asked about it specifically.
The board also outlined Volkswagen’s five-year plan, which will include investments of 159 billion euros, or $180 billion, with a focus on updating the company’s sites across Europe to supply and build electric vehicles.
Spending for electric vehicles will be raised by about 50 percent to 52 billion euros, or $59 billion.
