Audi CEO arrested in diesel emissions cheating probe

Audi CEO Rupert Stadler was arrested in connection with the diesel-cheating scandal, making him the highest-profile target in the probe that’s engulfed the carmaker and parent Volkswagen for almost three years.

Munich prosecutors investigating Audi’s role in the scandal said they arrested Stadler, 55, in the early hours of Monday at his house in Ingolstadt in Germany. Prosecutors asked for his arrest because of risk he may tamper with evidence, they said in a statement.

With the escalation of the case, German prosecutors who have been probing VW since September 2015 have finally broken through to the automaker’s higher ranks. Stadler’s arrest also raises new questions about a Volkswagen response that’s alternated between stonewalling and cooperation, while protecing its most senior managers.

The board reaffirmed Stadler’s role just last week, after authorities raided his house and named him a suspect in their probe of fraud and falsifying public documents in relation to selling diesel cars in Europe.

VW’s supervisory board plans to suspend Stadler and is set to name sales head Bram Schot as interim CEO, Handelsblatt reported, citing company sources.

Stadler is willing to be questioned later this week and his lawyers won’t challenge his arrest for now, prosecutor Stephan Necknig said. Investigators had indications Stadler, who hasn’t been charged, may influence witnesses in the probe, he said. Pre-trial detention can last as long as three months and can be extended while cooperative suspects usually leave custody much faster.

The arrest, which comes days after Volkswagen agreed to pay a $1.2 billion fine imposed by German prosecutors, throws into doubt the manager’s future at the helm of Volkswagen’s biggest earnings center. Stadler oversees a division that provides technology including engines to a number of the group’s brands — including Porsche. Audi may name an interim head at a board meeting on Monday, according to a report in FAZ.

‘‘I don’t think VW can afford to leave Stadler in the position,” Juergen Pieper, a Frankfurt-based analyst at Metzler Bank, said by phone. “It’s actually a mystery to me that they left him in place for so long.”

VW’s controlling Porsche and Piech families have continued to back Stadler, who has led Audi since 2007 and sits on VW’s management board, despite a constant drumbeat of allegations ever since Audi got embroiled in the diesel scandal.