Overnight Volkswagen held a contentious board meeting to decide the future of its CEO, as well as its direction over the next couple years.
While there’s a lot to unpack from today’s meeting, at the bottom of a statement issued about today’s board meeting, the company confirmed the board’s decision that “Lamborghini and Ducati will remain part of the Volkswagen Group”.
The company has been working on putting its three main Italian assets – Lamborghini, Ducati and Italdesign – into one legal entity.
Reports indicated this would make it easier for Volkswagen to partially or fully divest these three brands as it continues to make heavy investments in electric vehicle development and production.
The other brand said to be on the chopping block, Bugatti, wasn’t mentioned.
Bentley will also be placed under the control Audi from March 1, 2021 “in order to allow for synergies to be achieved as part of the electrification strategy of the two premium brands”. Up until now Bentley has been overseen by the CEO of Porsche.
Herbert Diess, Volkswagen Group CEO
Herbert Diess, the Volkswagen Group’s CEO, has been agitating the company to extend his contract even though the current one has two years left to run. This move has been opposed primarily by labor union representatives on the board, who are angered by job cuts in Germany.
While Diess didn’t get the contract extension he wanted, the company came out with a strongly worded statement praising its boss: “The Supervisory Board values the determination and persistence that Herbert Diess has exhibited in pressing forward not only with technological changes and the contribution to the achievement of climate goals, but also with the financial results of the company.
“In the upcoming years, the Board of Management of Volkswagen AG will implement the strategy with Herbert Diess at the top.”
It also committed to working with unions to reduce fixed costs by five per cent by 2023, and slashing material costs by seven percent over the next two years.
The board also approved executive changes that Diess had pushing for, including splitting procurement and components into separate responsibilities, and adding a technology chief.
Dr Arno Antlitz has also been elevated from Audi’s head of finance and legal affairs to the Volkswagen Group’s chief financial officer.
