Volkswagen was holding crisis talks on Monday to find a stand-in boss for its Audi brand, a source familiar with the discussions said, after German authorities arrested Audi CEO Rupert Stadler as part of a probe into emissions test cheating.
Stadler’s arrest throws Volkswagen (VW) into turmoil as it struggles to reform itself in the wake of the cheating revelations, which emerged after regulators blew the whistle in September 2015 on the carmaker’s use of illegal software.
The arrest looks set to raise tensions on VW’s supervisory board, putting at risk a fragile truce between management, VW’s controlling Piech and Porsche families, as well as representatives from labor and the region of Lower Saxony.
VW has for years said only lower-level managers knew of the emissions cheating, but U.S. authorities filed criminal charges against former VW boss Martin Winterkorn earlier this year, and Munich prosecutors widened their probe into Audi this month.
The Munich prosecutors said on Monday Stadler, the most senior active VW official to be remanded in custody since the scandal broke, was being held on fears he might hinder their investigation.
“We need to find a solution for Audi’s leadership for the time when he is not here,” the source familiar with the talks said about Stadler’s position. “We will comment on this later.”
Stadler was given additional responsibilities for group sales in a revamp announced by VW’s new Chief Executive Herbert Diess in April.
On Monday, VW and Audi directors were discussing the leadership crisis in separate meetings, with one source saying Dutchman Bram Schot was the front runner to become interim Audi chief.
Germany’s Sueddeutsche Zeitung newspaper said VW’s supervisory board had already picked Schot for the job and only needed the formal approval of Audi’s directors. VW denied any such appointment had been made.
VW has set aside around $30 billion to cover fines, vehicle refits and lawsuits since its “dieselgate” scandal broke, and has announced plans to spend billions more on a shift to electric vehicles as it seeks to rebuild its reputation.
