Volkswagen chief executive Bernd Pischetsrieder’s future was in doubt on Wednesday after the automaker’s chairman told a newspaper the supervisory board was split on renewing the CEO’s contract, Reuters said.
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Volkswagen chairman Ferdinand Piech reportedly told the Wall Street Journal there was a sharp divide on the board over the CEO’s contract, with workers’ representatives opposed to an extension beyond 2007 while shareholders’ representatives favoured keeping him on.
Reuters noted that Pischetsrieder has announced restructuring measures to reduce overcapacity which could put 20,000 jobs at risk, provoking the ire of Germany’s strong trade unions. In Germany, and at Volkswagen in particular, employee representatives have a big say in the strategic decisions of the company. On the supervisory board, staff representatives and shareholder representatives each have 10 seats, the report added.
“I do not know a company in Germany where somebody can survive with 10 employee votes against,” Piech told the Wall Street Journal, adding the issue of the CEO’s contract renewal remained open.
Pischetsrieder has been with VW since 2002 after he lost the top job at BMW following the botched acquisition of Britain’s Rover group, Reuters said.
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By GlobalDataThe report said Piech, as chairman, has a double vote and the investor side could in theory outvote the staff side but the employee side backed Piech when major shareholder Lower Saxony tried to unseat him.
Piech reportedly told the newspaper that the German state of Lower Saxony and the Porsche family both backed an extension of Pischetsrieder’s contract.
