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November 18, 2005

GERMANY: Union calls for calm after VW board appointment row

IG Metall tried to limit the damage from its role in sparking an internal power struggle at Volkswagen after the German trade union's choice to head VW personnel was approved over management's objections, according to Reuters.

IG Metall tried to limit the damage from its role in sparking an internal power struggle at Volkswagen after the German trade union’s choice to head VW personnel was approved over management’s objections, according to Reuters.

In an interview with German business daily Handelsblatt that appeared on Friday, IG Metall’s second-highest-ranking official reportedly defended designated HR chief Horst Neumann and appealed for harmony amid bitter strife on VW’s supervisory board, Reuters said.

“I’m convinced that Horst Neumann will not shun the cost problem at VW – he cannot, IG Metall cannot, nor can the company,” Berthold Huber reportedly told the newspaper.

Reuters noted that Volkswagen chairman Ferdinand Piech ignited the conflict after backing the union’s choice despite objections from shareholder representatives on the supervisory board and from VW chief executive Bernd Pischetsrieder. The spat prompted one board member to resign in protest, the report said.

The report added that Huber’s comments came only days after Volkswagen’s works council boss Bernd Osterloh also tried to soothe tempers. Rampant speculation has circulated that Piech – one of the 10 shareholder representatives on the 20-person board – has allied himself with staff representatives to out-manouevre his main board rival, Lower Saxony state premier Christian Wulff, it said.

According to Reuters, Neumann, who was a senior functionary at IG Metall for 16 years, was originally a leading candidate for the VW job but soon met opposition due to his strong links to the union and the political left, in particular from conservative Wulff.

“To deny someone’s competence just because he used to work for IG Metall is discriminatory and absolutely below the belt, in my opinion,” Huber was quoted as saying.

The IG Metall official expressed regret that Gerhard Cromme, chairman of the German corporate governance code commission, will resign from Volkswagen’s board in May, Reuters said.

Huber reportedly called on Wulff, who sits on the board as caretaker of Lower Saxony’s 18.2% voting stake in VW, to join forces with IG Metall to protect jobs at the car maker, which has said it has thousands of surplus members of staff.

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