Two years for Volkswagen to recover from emissions scandal, says new boss
The new boss of crisis-hit Volkswagen says the company will be able to recover from the emissions scandal in as a little as two years.
Matthias Mueller, who took over as chief executive after Martin Winterkorn resigned, after the car giant admitted to installing equipment in cars that let them beat pollution checks, made the prediction in a speech to staff in Leipzig.
“We have a good chance of shining again in two to three years,” Mr Mueller told VW managers.
Setting out his strategy, he added: “We must become leaner and take decisions more rapidly. Our competitors are only waiting for us to fall behind on technology matters because we are so preoccupied with ourselves but we won’t let that happen.”
Earlier this week the company – which has said 11m of its Audi, VW, SEAT and Skoda cars are fitted with the so-called “defeat devices” which let them beat emissions tests – announced it was cutting investment and research and development by €1bn, but would put a new focus on electric vehicles.
Speaking yesterday he added: "We will significantly streamline structures, processes and [decision-making] bodies.”
This would give more power to regional chiefs and the company’s individual car brands.
His optimistic words were in contrast to the VW’s share price which has plunged as much as 40pc since the scandal broke and came on the day that German motor regulators announced a mandatory recall of 2.4m cars in the country, taking the number to 8.5m in Europe.
Arndt Ellinghorst, automotive head at Evercore, said that the new chief executive’s sentiments could well prove correct.
“I believe he is right,” said the analyst who has long been calling for change at VW, including slashing its research budget, which is the biggest of any car company.
“Most companies come out of crisis mode stronger than before. GM and Toyota are good examples of that. VW has a huge opportunity to fix the diesel issues, tackle its morbid culture, cut costs and return revitalised. It seems this company was calling for creative destruction,” he said.
In Britain, VW company’s UK boss faced MPs for a second time in a week about the scandal, telling them that company had not communicated well with customers about the issues.
He added that it could take until the end of the year before an external investigation reveals exactly who in the company knew what about the “defeat devices” and when they knew it.
Reports in Germany claimed that another senior engineer who developed VW’s diesel engines had been suspended, adding to the three already said to be on leave because of the scandal.