VW emission-cheat software used on European cars

Porsche chief Matthias Müller expected to be named new Volkswagen CEO

Matthias Müller’s appointment has the support of a majority on the 20-member supervisory board, according to sources. Photograph: Odd Andersen/AFP/Getty Images

Matthias Müller’s appointment has the support of a majority on the 20-member supervisory board, according to sources. Photograph: Odd Andersen/AFP/Getty Images

 

Volkswagen’s scandal continued to gather momentum as it emerged the cheat software used to deceive US emissions tests featured on European cars.

The confirmation came as the board of Volkswagen Group prepares to meet today to announce a successor to Martin Winterkorn, who resigned as chief executive on Wednesday. According to media reports, citing unnamed VW sources, Porsche chief Matthias Müller is expected to be named new chief executive of the crisis-wracked group.

Volkswagen AG shares fell yet again yesterday, closing at €119.30, down 2.2 per cent on the day and 25 per cent on last Friday’s close, hours before it admitted cheating on US emissions tests on its diesel engines for over six years.

On Tuesday the car giant – whose 12-brand empire includes Audi, Skoda, Seat, Porsche and VW among others – said 11 million cars globally featured the cheat software. While Volkswagen Group Ireland declined to confirm how many Irish cars may be involved, it is estimated nearly 80,000 here could feature the diesel engine at the centre of the controversy.

With criminal proceedings likely to follow in the US and Germany, investigations are already under way in several countries. The European Commission invited “all member states to carry out the necessary investigations at national level and report back”. “We need to have a full picture of how many vehicles certified in the EU were fitted with defeat devices,” it said.

As well as the cost of regulatory fines and potentially refitting cars, Volkswagen faces criminal investigations and lawsuits from cheated customers and possibly shareholders. The carmaker has enlisted Kirkland & Ellis – the US law firm employed by BP in the 2010 Deepwater Horizon oil disaster in the Gulf of Mexico – to deal with legal claims.

The scandal looked set to spread to other brands yesterday as the German government confirmed it is not concentrating its investigations solely on VW and has promised to scrutinise other carmakers on the German market.

Shares in BMW fell yesterday after a report its X3 also failed to meet emission standards for nitrogen oxide. Unlike VW, German car magazine Auto Bild reported that the BMW problem was not caused by software manipulation.

If, as expected, Matthias Müller is appointed chief executive today, he will take responsibility for the biggest business crisis in Volkswagen’s 78-year history and one that has consequences for the reputation of German industry internationally as well. Customers and motor dealers have expressed frustration at a lack of information about how they will be affected by the scandal.

Mr Müller’s appointment has the support of a majority on the 20-member supervisory board, according to sources. VW declined to comment.

Mr Müller, who has worked for parts of the Volkswagen empire since the 1970s, is a management board member of Porsche SE and so is close to the Piëch-Porsche family that controls Volkswagen Group through a holding company.

He was promoted to VW’s executive board in March, and had been viewed as a favourite of family patriarch Ferdinand Piëch, who reportedly sought to install him as VW chief executive in place of Mr Winterkorn earlier this year.

Mr Winterkorn survived a power struggle that saw Mr Piëch forced to step down as company chairman and his job looked secure until the emissions scandal broke. Mr Müller, Rupert Stadler, who runs VW’s Audi brand, and VW brand head Herbert Diess had been seen as frontrunners to replace Mr Winterkorn as VW sought a successor.