The management of Volkswagen has given a deplorable picture in the past few months. In internal trench warfare, the protagonists - once again - engaged with themselves in a publicly effective manner, while the automotive industry around Wolfsburg is changing rapidly. Actually, the supervisory board meeting on Thursday should have sent the important signal that Europe's largest manufacturer will invest an impressive 89 billion euros in technology and factories over the next five years in order to win the competition with rising rivals from America and Asia. In the foreground, however, was the bickering between CEO Herbert Diess and the employee representatives who demanded his removal. The result was a solution à la Volkswagen: Diess will continue, but somehow different.A communicative debacle is followed by a compromise that raises many questions. Above all one: How long does the truce last?
The latest escalation was triggered by business games by the corporate executive about the possible loss of 30,000 jobs. An outrageous provocation for the works council, trade union and the state of Lower Saxony. Because Diess is a repeat offender, was already close to his resignation in 2020. Back then, he was saved from the separation by the backing of the capital side, which their mastermind did not want to lose on the way to electromobility. The manager, who had once come from BMW, then ate chalk when he admitted that he was not diplomatic enough for the VW biotope. Wolfsburg cannot be stormed with your head through the wall. The handing over of responsibility for the core brand VW to Ralf Brandstätter should ease the situation. However, the plan did not last long.
Because Diess persisted in his nature and pestered the employee lobby whenever the opportunity arose, for example by calculating for them that the electric car pioneer Tesla only needed a third of the time to produce a vehicle in its new plant in Brandenburg. With that he hits a sore point: As the responsible manager, he has to ensure that Volkswagen is not only competitive in China or the Czech Republic, but also in the main plant. Such adjustment processes are painful for those affected - but if you put them on the back burner, the incisions can be even deeper later. The fact that, with the repeatedly sought-after closeness to Tesla boss Elon Musk, gives parts of the workforce the impression that he is more of a fan than a rival, however, understandably falls on his feet.
This has to catch up in the software
In the future, Diess will have to accept even more influential people in his environment and give up more power as the price for being able to fulfill his contract, which dates to 2025 - even if all sides try to refute this impression.
If Brandstätter, who is moving up to the board of directors, gets the sales problems of the fully electric ID models in the most important single market of China under control, a successor candidate will emerge in him, which not only the employee representatives would like to see at the top today rather than tomorrow.
After a successful IPO, Porsche boss Oliver Blume would also offer himself the pearl of earnings for higher tasks.
After the chaos, this must quickly prove its ability to act by implementing the resolutions. Above all, it will be measured by whether it will finally be possible to catch up with the competition in terms of software. He has to show that he can find solutions without a crowbar. This is the only way to regain trust. After all, neither the company nor a country whose prosperity still depends heavily on cars can afford a leader on call.
Ultimately, the latest events also bring Volkswagen's power structures into focus.
How can a VW boss decide independently about investments in the Lower Saxony plants, if at the same time the vote of the Prime Minister in the supervisory board together with the employees decides on his whereabouts?
This unique influence of the state government and works council is difficult to reconcile with the principles of modern governance.
In times of profound upheaval, Volkswagen needs a manager at the top with enough legroom to enable the necessary decisions to be made at the required speed.
Without this change, every CEO in the long run threatens to run against Wolfsburg walls.