This article is from the source 'nytimes' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at http://www.nytimes.com/2015/09/24/business/international/volkswagen-chief-martin-winterkorn-resigns-amid-emissions-scandal.html

The article has changed 6 times. There is an RSS feed of changes available.

Version 1 Version 2
Volkswagen C.E.O. Martin Winterkorn Resigns Amid Emissions Scandal Volkswagen C.E.O. Martin Winterkorn Resigns Amid Emissions Scandal
(35 minutes later)
FRANKFURT — Martin Winterkorn resigned as chief executive of Volkswagen on Wednesday, taking responsibility for an emissions cheating scandal that has gravely damaged the carmaker’s reputation and may spread to the German economy.FRANKFURT — Martin Winterkorn resigned as chief executive of Volkswagen on Wednesday, taking responsibility for an emissions cheating scandal that has gravely damaged the carmaker’s reputation and may spread to the German economy.
“As C.E.O. I accept responsibility for the irregularities that have been found in diesel engines,” Mr. Winterkorn, 68, who had headed the company since 2007, said in a statement.“As C.E.O. I accept responsibility for the irregularities that have been found in diesel engines,” Mr. Winterkorn, 68, who had headed the company since 2007, said in a statement.
But he continued to insist that he personally had committed no misconduct. “I am not aware of any wrongdoing on my part,” he said.But he continued to insist that he personally had committed no misconduct. “I am not aware of any wrongdoing on my part,” he said.
Volkswagen shares, which had been up on Wednesday after two days of steep declines, remained nearly 6 percent higher on the news late in the day in Germany. But they were still about 25 percent below the closing price in Frankfurt on Friday, before news of the scandal broke.Volkswagen shares, which had been up on Wednesday after two days of steep declines, remained nearly 6 percent higher on the news late in the day in Germany. But they were still about 25 percent below the closing price in Frankfurt on Friday, before news of the scandal broke.
Mr. Winterkorn’s resignation came less than a week after the company admitted that some diesel cars in the United States contained software designed to evade emissions tests. On Tuesday, Volkswagen said that 11 million cars worldwide contained the software, although the company did not clarify whether it was also used to deceive regulators in other countries.Mr. Winterkorn’s resignation came less than a week after the company admitted that some diesel cars in the United States contained software designed to evade emissions tests. On Tuesday, Volkswagen said that 11 million cars worldwide contained the software, although the company did not clarify whether it was also used to deceive regulators in other countries.
Separately, representatives of Volkswagen’s supervisory board said they would refer the case to German prosecutors for possible criminal prosecution. But they also said they did not believe that Mr. Winterkorn had any knowledge of the manipulation.Separately, representatives of Volkswagen’s supervisory board said they would refer the case to German prosecutors for possible criminal prosecution. But they also said they did not believe that Mr. Winterkorn had any knowledge of the manipulation.
A steering committee of the supervisory board did not immediately name a successor. Speculation has focused on Matthias Müller, who is in charge of the Volkswagen division that makes Porsche sports cars. A steering committee of the supervisory board did not immediately name a successor. As Mr. Winterkorn’s status came into doubt in recent days, speculation focused on Matthias Müller, who is in charge of the Volkswagen division that makes Porsche sports cars.
Another potential candidate might be Rupert Stadler, head of Volkswagen’s Audi division. If Volkswagen brought in an outsider, one oft-mentioned person is Wolfgang Bernhard, the head of the trucks division at Daimler, who earlier in his career was a top manager at Volkswagen.
Mr. Winterkorn’s resignation came after a daylong meeting of the steering committee, known as the presidium, which includes the company’s main shareholders.Mr. Winterkorn’s resignation came after a daylong meeting of the steering committee, known as the presidium, which includes the company’s main shareholders.
“In the view of the presidium, irregularities occurred which could be relevant under criminal law,” the presidium said in a statement. It said Volkswagen would cooperate fully with any investigation.“In the view of the presidium, irregularities occurred which could be relevant under criminal law,” the presidium said in a statement. It said Volkswagen would cooperate fully with any investigation.
“The members of the presidium have determined that Prof. Dr. Winterkorn had no knowledge of manipulation of emission values,” the group said.“The members of the presidium have determined that Prof. Dr. Winterkorn had no knowledge of manipulation of emission values,” the group said.
In Germany, even before word of Mr. Winterkorn’s resignation, there was growing concern on Wednesday that the scandal could damage the country’s economy, which revolves around the auto industry. Volkswagen is one of the country’s biggest companies, employing 274,000 people in Germany at 29 factories, and it is already struggling with high labor costs. That figure does not count the tens of thousands of people employed in Germany by Volkswagen suppliers. That statement immediately raised the question of why Mr. Winterkorn needed to resign if he had not known about the manipulation. One answer might be that Volkswagen has long been known as a top-down organization, where even relatively minor decisions require approval from the high-rise executive office building, topped by a giant VW grill ornament, which looms over the company’s vast main factory in Wolfsburg, Germany.
Volkswagen’s command-and-control structure probably made it difficult for Mr. Winterkorn to escape responsibility, even if there was no direct culpability. Critics have long faulted what they said was a company culture that hampered internal communication and might have discouraged midlevel managers from delivering bad news.
In the German media on Wednesday, there was already speculation that the scandal would force Volkswagen to decentralize authority and make changes that critics say are long overdue.
Even before word of Mr. Winterkorn’s resignation, there was growing concern in Germany on Wednesday that the scandal could damage the country’s economy, which revolves around the auto industry. Volkswagen is one of the country’s biggest companies, employing 274,000 people in Germany at 29 factories, and it is already struggling with high labor costs. That figure does not count the tens of thousands of people employed in Germany by Volkswagen suppliers.
The German Engineering Federation, which represents machinery makers and is closely intertwined with the auto industry, said there was a risk that the “Made in Germany” brand could suffer. The organization said in a statement that it was worried “that one instance of misconduct could be carried over to all of German industry.”The German Engineering Federation, which represents machinery makers and is closely intertwined with the auto industry, said there was a risk that the “Made in Germany” brand could suffer. The organization said in a statement that it was worried “that one instance of misconduct could be carried over to all of German industry.”
The Federal Financial Supervisory Authority, which regulates the German stock market, said it had begun an inquiry into what it described as unusual price movements in Volkswagen shares recently. The authority, known by its German acronym BaFin, said it was also examining whether Volkswagen had notified shareholders soon enough of its problems in the United States.The Federal Financial Supervisory Authority, which regulates the German stock market, said it had begun an inquiry into what it described as unusual price movements in Volkswagen shares recently. The authority, known by its German acronym BaFin, said it was also examining whether Volkswagen had notified shareholders soon enough of its problems in the United States.
As in the United States, German companies are required to advise shareholders of information that could affect the stock prices and face fines and shareholders lawsuits if they do not.As in the United States, German companies are required to advise shareholders of information that could affect the stock prices and face fines and shareholders lawsuits if they do not.