Volkswagen boss Herbert Diess was ailing after a bitter dispute with the works council, but was initially able to hold on.

Therefore, his departure from the top post of the car company, announced on Friday evening, comes as a surprise despite the long history.

Herbert Diess will go on September 1st, Volkswagen announced.

His successor will be the boss of the sports car subsidiary Porsche AG, Oliver Blume.

Blume is to continue in his current position in parallel.

He is currently working on an IPO for Porsche AG, which should go ahead in the fall.

At VW, 54-year-old Blume will be supported operationally by Chief Financial Officer Arno Antlitz, who will also be responsible for day-to-day business in the future.

The former BMW manager Diess has been leading VW since April 2018. The supervisory board has agreed with the 63-year-old to leave, Volkswagen said.

The chairman of the VW supervisory board, Hans Dieter Pötsch, thanked Diess on behalf of the entire supervisory body for the work on the transformation of the company.

Like the entire automotive industry, Volkswagen is struggling with the shift towards electromobility and the software-controlled car.

In addition, the lack of supplier parts in the automotive industry is causing problems.

The works council accused Diess of reacting too late to the crisis in the supply of important semiconductors.

Flower's name has been dropped several times behind the scenes

Volkswagen shares came under pressure after the market closed when news of the change at the top of VW spread.

Porsche driver Blume had long been considered a possible successor to Diess.

His name had been mentioned several times behind the scenes when a conflict between the VW boss and the powerful works council over possible new austerity programs escalated last year.

Even before that, there had been violent differences of opinion with parts of the supervisory board about the further strategy and about a possible drastic job cut at Europe's largest car manufacturer.

The surprising change of boss at Volkswagen has met with approval from the automaker's employee representatives.

In addition to its role as a technological favourite, Volkswagen must also do justice to its role as a social role model, explained IG Metall boss and Volkswagen supervisory board vice-president Jörg Hofmann on Friday.

"The decisions made today make it possible to keep up the pace and use the lead we have worked out."

Daniela Cavallo, head of the VW works council, said that job security and profitability must remain corporate goals of equal importance.

“All colleagues have to be taken along.

Today's decisions contribute to that."