Diess came from BMW in 2015 to head the core VW brand (Photo: VW)

Volkswagen Group appointed Herbert Diess CEO and announced a far-reaching reorganization of the 12 brand automotive group.

Diess will retain his position as head of the core Volkswagen brand, but will take over responsibility for all group operations from Matthias Mueller effective immediately.

Mueller took over from CEO Martin Winterkorn in 2015, following the latter’s departure amid revelations that VW had cheated on diesel emission tests. But it was clear from the start that Mueller, a company veteran, was an interim choice to lead VW.

Diess came to Volkswagen in 2015 from BMW after the premium car maker selected Harald Krueger to run the company. Following a rocky start that saw Diess initially tangle with VW’s powerful unions, the VW brand executive settled into his new role and successfully orchestrated a change of focus toward electric vehicles.

Diess, on Thursday, made clear what will be his top priority. “My most important task will now be to join with our management and our group work force in consistently pursuing and pushing forward our eveolution into a profitable, world-leading provider of sustainable mobility,” he said in a press statement.

He added that, against a backdrop of massive upheaval in the global auto industry, “it is vital for Volkswagen to pick up speed and make an unmistakable mark in e-mobility, the digitalization of the automobile and transportation as well as new mobility services.”

VW announced this week that the company will, in future, have three brand groups: volume, with VW, Skoda and Seat; the Audi premium brand; and super premium, which includes Porsche, Bentley, Bugatti and Lamborghini . The company’s trucks, buses and commercial vehicles will become a separate, listed company.

The reorganization also gives additional responsibility to several top managers. Diess himself, in addition to the CEO and brand CEO jobs, will be in charge of group development and research.

Audi CEO Rupert Stadler will oversee group sales across all brands and Oliver Blume, who heads premium sports car maker Porsche, will join the VW Group management board as overall head of car production.

No board position for digital

Contrary to some speculation, Diess won’t create a board position for CDO Johann Jungwirth, who is spearheading the group’s digital transformation. In a press briefing, Diess said that decision reflects the cross-divisional role of IT across the company.

“We consciously decided against an executive-board-level division for digitalization because we don’t want to create an additional silo,” Diess said. “IT and digital affects every business area in the new structure.”

Diess will personally take charge of matters related to car IT, because this area is seen as crucial to the future success of the brands. Corporate IT will fall under the overall responsibility of Finance Director Frank Witter.

As part of the restructuring, VW said that long-serving purchasing boss Francisco Javier Garcia Sanz, would leave the company after roughly 20 years. His responsibilities will be assumed by Rolf Brandstaetter, head of procurement for the VW brand.

Gunnar Kilian, secretary general of the VW Group works council, will join the management board with responsibility for human resources. He succeeds Karlheinz Blessing.

-By Arjen Bongard