New VW chief an outspoken insider
Critics doubt Mueller is right man for job
BERLIN: Matthias Mueller, Volkswagen’s new chief executive, has not been the typical button-down German executive.
Before the company’s emissions-testing scandal broke, he had spoken out in support of the migrants streaming into Germany, likening their journey to his own childhood as a refugee from East Germany. Mr Mueller, who had been the head of the Porsche division at Volkswagen, is also a racing enthusiast who has poked fun at the industry’s infatuation with self-driving cars.
“We don’t want a smartphone on wheels,” he told a German car magazine recently.
A few days after that comment, his boss at the time, Martin Winterkorn, said that, by the end of the decade, Volkswagen “will have transformed all of our new cars into smartphones on wheels”.
But there is scepticism that Mr Mueller is the right person to change Volkswagen’s corporate culture. He was a long-time lieutenant of Mr Winterkorn, who resigned as chief executive recently, and was Volkswagen’s head of product planning from 2007 to 2010 as the cars that caused the scandal were being developed.
Mr Winterkorn — considered the man whose ambitions to build the world’s largest car company led Volkswagen into crisis — has not severed his own ties with the company. He remains chief executive of Porsche Automobil Holding SE, Volkswagen’s largest shareholder. He is also on the supervisory board of Porsche Holding, the largest Volkswagen dealer in the world, operating in 22 countries in Europe, South America and China. And he remains on the board of the Audi division at Volkswagen.
The scandal came to light last month, when Volkswagen said it had installed software in 11 million diesel vehicles worldwide that was used to cheat emissions tests in the United States. Mr Mueller, whose company is facing investigations across the world, has promised to restore trust, conduct an aggressive internal investigation and come up with a fix by this week.
An engineer with a passion for cars, he told reporters recently that he did not know about the scheme. Speaking to senior managers in Wolfsburg, Germany, he called Volkswagen’s manipulation of emissions tests inexcusable.
Mr Winterkorn has also denied knowledge of the scheme. “I am not aware of any wrongdoing on my part,” he said after the scandal broke.
As one of his first strategic moves, Mr Mueller said he would give the division that makes Volkswagen brand cars the same independence as other brands like Audi or Porsche. The change was tacit acknowledgement that management of the company’s largest unit by volume has been overly centralised.
Mr Mueller has also made little attempt to distance himself from Mr Winterkorn, to whom he owes much of his career success.
The company’s approach has caused concern among some environmentalists that it is not ready to change its culture.
“I am disappointed,” said Rebecca Harms, a prominent member of the Green Party in the European Parliament, who comes from Lower Saxony, a German state that is also a major Volkswagen shareholder. Her party controls the state in a coalition with Social Democrats.
Ms Harms said Volkswagen, which is based in Lower Saxony, had an opportunity to break with the past but missed it in its rush to appoint Mr Mueller as chief.
“They needed a fast decision,” she said. “What I would have loved would be now to go for a real shift, to bring in new people, not protecting the old way.”
Volkswagen was one of the first caught cheating when the US started regulating tailpipe emissions in the early 1970s.
Dan Becker, director of the safe climate campaign at the Center for Auto Safety in Washington, said Volkswagen needed “to scour the house with an outsider who’s not afraid to get to the heart of this huge fraud and its perpetrators, however high. Instead they have chosen a long-time VW crony.”
Others are more supportive. Stefan Bratzel, director of the Center of Automotive Management, near Cologne, said: “Before the scandal, it was known that he said what he thinks,” he said. “That’s not the usual thing at Volkswagen if you want to make a career.”
Indeed, Mr Mueller has not always toed the party line. While Volkswagen and many other automakers have talked up self-driving cars, he told magazine Auto Motor und Sport: “I ask myself how a programmer is going to decide whether, in an emergency, an autonomously driven auto is going to steer to the right into a truck or left into a compact car.”
Mr Mueller also spoke out on a topic that has been avoided by many other executives: the stream of refugees heading to Germany’s borders. In an interview with Suddeutsche Zeitung, he referred to his own childhood when his family fled East Germany.
“I was three years old and the trip was terrible, but we were still in the same cultural environment,” he said. “The people who are arriving now are for the most part torn completely out of their culture. I find that very difficult. We have to help.”
Mr Mueller said he had raised the topic during a visit to a Porsche subsidiary in Schwarzenberg, a region known for its hostility to migrants.
In a company that values technical expertise and hands-on management, the choice of Mr Mueller makes sense. As a young man, he first learned a trade, working as an apprentice toolmaker at Audi, which in the world of Volkswagen is a sign that he knows how to get his hands dirty and understands what happens on the factory floor.
In the early 1990s, he made a name for himself inside the company as head of project management for the compact Audi A3, a popular car in Europe. Later he was named Audi’s head of product development.
When Mr Winterkorn, his boss at Audi, became Volkswagen’s chief executive at the start of 2007, Mr Mueller was one of his first hires. Not long after Mr Winterkorn and his lieutenants came to power, they decided to scrap a deal to share technology with Mercedes, which had its own system to filter smog-forming pollutants. Instead, Volkswagen decided to use its own technology.
Mr Mueller was head of product planning at Volkswagen when the company installed software intended to cheat US emissions tests, and was until he left to run Porsche in 2010.
He would typically have coordinated the development of new cars across brands, looking for ways to share costs, parts and engineering platforms. During this period, the company was starting an ambitious plan to more than triple US sales over a decade.
Volkswagen executives were confronted with the challenge of trying to sell larger vehicles to meet US demand while also complying with toughening US gas mileage standards as well as restrictions on smog-forming pollutants that are more stringent than those in Europe.
Wolfgang Hatz, the head of research and development at Porsche, has been suspended with pay during an internal review. He was head of engines and transmissions development for Volkswagen in 2007.
Would — or should — an engineer who was head of product planning have known about a scheme that would enable the company to cheat on emissions tests on a broad scale? Ferdinand Dudenhoeffer, a professor at the University of Duisburg-Essen who is often critical of Volkswagen, said: “I can’t imagine he was personally involved.”
He said Volkswagen had little choice but to appoint an insider to replace Mr Winterkorn because there was no time to recruit a qualified outsider. But Prof Dudenhoeffer said that, even if he wanted to make big changes, Mr Mueller would be constrained by a supervisory board firmly in the hands of the old guard.
“If they really want a new beginning,” he said, “they need a strong outsider.”