German carmaker Volkswagen is considering replacing its CEO Matthias Muller in a management reshuffle. The announcement comes in the wake of a scandal in which the company was accused of fitting its diesel engines with devices to pass emissions tests.
According to German newspaper Handelsblatt, which first reported the shakeup, Muller is to be replaced by Herbert Diess, who currently heads up the Volkswagen brand. Müllers dismissal comes despite the companys strong performance last year which saw profits of €17bn (£14.8), a 16 per cent increase on the year before.
In a statement released today, the company said only that it was considering “personnel changes in the board of management [which] could also include a change in the position of the chairman of the board of management”. The company also said that Muller “showed his general willingness to contribute to the changes.”
However, Volkswagen refused City AMs request to confirm whether Muller was resigning, and whether he would be replaced by Diess. German newspaper Der Spiegel has reported that the changes could take place as soon as Friday.
VW shares got an additional boost from the reports that it is planning on replacing Mueller. "It would be the second head of a major German company on the chopping block in as many days," said Jasper Lawler, head of research at London Capital Group "German firms seem to be taking a football club approach to management."
Despite the emissions scandal, Müller took home €10.14m in 2017, almost 40 per cent more than what he made the year before. The CEO received €9m in basic remuneration plus "fringe benefits" totalling over €10m. This is despite the companys €10m cap on top executives compensation.