New conflict at Volkswagen weakens boss Herbert Diess

A new violent conflict has broken out at Volkswagen (VW), between the group’s boss, Herbert Diess, and employee representatives, and no one knows how it will end. On the stock market, the quarrel has already caused the price to unscrew by 4% during the day of Wednesday, November 3. Faced with their leader, the employees apparently unsheathed the most powerful weapon they have at VW, the vote of no confidence, assures the daily Handelsblatt. The phase that opens, if no compromise is found, could lead to the ousting of Herbert Diess, who has led VW since April 2018 and has since led one of the biggest transformations ever carried out by the world’s second-largest automaker. .

In Wolfsburg, at the group’s headquarters, tension had been mounting for several weeks. The first shock came on September 24, when Herbert Diess hinted at a supervisory board session that 30,000 jobs were at risk at VW. Faced with the emotion aroused by this comment, he finally clarified that it was only a “Extreme scenario”, in the event that the company fails to significantly improve its efficiency and continue its transformation to electricity and digital.

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A second conflict erupted a few days later, when Herbert Diess declined to attend a staff meeting scheduled for Thursday, November 4, in order to attend an investor conference in the United States. Daniela Cavallo, the new president of the workers ‘committee, the “Betriebsrat”, traditionally very powerful at VW, took the announcement as a personal affront and severely criticized the decision, criticizing the boss for not taking an interest in workers’ concerns. , in a situation where the shortage of electronic components affects production. Eventually, Mr. Diess changed his mind. He will participate in this high-risk meeting on Thursday.

Modernize the group and lower costs

This is not the first time that Herbert Diess is on the verge of being laid off. In the summer of 2020, he had saved his post only extremely narrowly, after an official apology for accusatory remarks towards certain members of the supervisory board. A few months later, a new quarrel had settled over the question of the extension of his contract, which he demanded two years in advance. This had been badly perceived, reinforcing his image as a lonely boss, reluctant to comply with the customs of the group. In the VW universe, important decisions are the result of a compromise between two camps with opposing interests: the employees’ committee and the Land of Lower Saxony, which holds 11.8% of the group’s capital and 20% of the rights. vote, allies to keep jobs there, and the Porsche-Piëch family, shareholder in 31.3% (53.3% of the voting rights), more concerned with profitability and results.

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New conflict at Volkswagen weakens boss Herbert Diess