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In a power struggle leading up to a board meeting on Monday, Diess had demanded an early contract extension and more backing for his reform efforts from the carmaker’s non-executive board. He met resistance from powerful directors who represent employees and unions.
After the meeting, the non-executive supervisory board also said in a statement the carmaker would cut overhead costs by 5% and procurement costs by 7% over the next two years.
Diess had sought to lower costs in Germany to free up resources for a mass electrification push and to transform the 83-year old automaker into a tech company modelled on Tesla (NASDAQ:TSLA).
That led to a clash with Bernd Osterloh, Volkswagen (DE:VOWG_p)’s chief labour representative, over issues including appointments to the management board and whether to extend Diess’s contract beyond 2023.
The non-executive board, of which Osterloh is also a member, said it had unanimously voted to support the transformation to e-mobility and digital technologies.
“Over the coming years, the executive board will implement this strategy under Herbert Diess’ leadership,” the supervisory board said.
The statement said Arno Antlitz would become group finance chief, succeeding Frank Witter, who would quit in June 2021 as previously announced.
Thomas Schmall would become board member in charge of a newly-created technology division from Jan. 1
Also from next year, Murat Aksel, the head of procurement at the VW car brand will in addition take on the same role for the entire group.
