Matthias Mueller, head of Volkswagen AG's (VLKAY) Porsche subsidiary, appears to be the leading candidate to replace Martin Winterkorn as the automaker's chief executive officer following U.S. charges of faked emission tests on diesel vehicles.
Mueller, 62, a onetime apprentice tool maker and a computer sciences graduate, was appointed by Winterkorn to a series of senior posts developing Audi and VW vehicles. Since last year, Mueller has been the chief information officer for Porsche Automobil Holding SE, the Porsche family company that controls 51% of VW.
The U.S. Environmental Protection Agency last week rocked VW with charges that nearly half a million Audi and VW diesel-powered cars in the U.S. were emitting far more than the proper level of pollutants thanks to an illegal "defeat" mechanism in testing software. The fine for the infraction, if levied, could amount to $18 billion. Winterkorn apologized and resigned on Wednesday, adding that he had been unaware of any alleged illegality.
Since Friday, Volkswagen shares have fallen about 29%, throwing the company into crisis mode. Media reports, which VW declined to confirm, have surfaced that the automaker intends to replace its U.S. head, Michael Horn. Also unconfirmed is the exit of Ulrich Hackenberg, the highly visible and respected head of VW R&D.
The EPA's charges have also called into question the role of diesel technology in future clean-air regulations. With the development of more advanced engines, VW and other automakers have been promoting so-called "clean" diesel, which clean-air and environmental advocates have criticized and opposed. By contrast, Japanese carmakers have favored gas-electric hybrids as a better technology for meeting toughening fuel efficiency standards without sacrificing air quality.
Winterkorn's tenure was threatened earlier this year, when found himself crosswise with Ferdinand Piech, VW's chairman, and owner of about 10% of its shares. Piech resigned as chairman, though he was said to have soured on Winterkorn and may have favored Muller as his replacement.
"In the end, Piech, even though he's not chairman of the board, got his pick all along, so that's a little ironic," said Matt DeLorenzo, managing editor of Kelley Blue Book, in an interview with USA Today. "I would have preferred to see VW go to an outsider and especially not another engineer."
"Mueller has been a longtime insider at VW and I still wonder if that will be enough to quell criticism that they're not really taking this that seriously," DeLorenzo said. "We have to learn what the extent was in terms of the knowledge of this scandal within the company."
VW's full board is scheduled to meet Friday, an event that could foreshadow other changes at the automaker, which faces a slew of litigation, criminal investigations and a loss of reputation among dealers and owners.
Doron Levin is the host of "In the Driver's Seat" on SiriusXM Insight 121, Saturday at noon and Sunday at 9 a.m.
The writer has no financial interest in the aforementioned companies.