VW Reportedly Will Name Porsche Head as New CEO as More Heads Roll

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By Reuters

BERLIN - Volkswagen's supervisory board will pick the head of sports-car maker Porsche as its next chief executive to succeed Martin Winterkorn who resigned on Wednesday, a source familiar with the matter told Reuters.

Matthias Mueller, 62, the VW group's former head product strategist, has a majority on the 20-member supervisory panel which is due to meet on Friday, the source said. (NBC News has not confirmed Mueller’s appointment.)

Porsche AG CEO Matthias Mueller sits in a Porsche 911 Targa 4GTS prior to a news conference on March 13.MARIJAN MURAT / EPA file

Winterkorn resigned after almost nine years at the helm of Europe's biggest carmaker after VW was found manipulating emission standards in diesel cars sold in the United States. Since then, shares in the world's largest carmaker by sales have plunged as much as 40 percent.

The supervisory panel also will dismiss Michael Horn, the head of the company's U.S. operations, and top research and development officials at its Audi and Porsche brands, Ulrich Hackenberg and Wolfgang Hatz, respectively, on Friday, a senior source told Reuters.

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Mueller is a management board member of Porsche SE and so is close to the Piech-Porsche family that controls Volkswagen through the holding company. He also spent many years at Audi.

"He is a good choice even though he may be seen as a transitionary CEO until another internal candidate such as VW brand CEO Diess has earned their stripes," said Arndt Ellinghorst, an analyst at Evercore ISI investment banking advisory firm.

He said Mueller's priority would be renew VW's leadership, restructure costs and turn VW into a "performance-driven company" where management was more accountable."

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VW said on Tuesday about 11 million of its cars worldwide were fitted with the software that was found to be cheating emissions in the United States. The U.S. Environmental Protection Agency has said Volkswagen could face penalties of up to $18 billion.

However, the crisis is still deepening. Germany's transport minister, Alexander Dobrindt, said on Thursday Volkswagen had manipulated tests in Europe as well as the United States.

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Dobrindt told reporters vehicles with 1.6 and 2.0 liter diesel engines were" affected by the manipulations that are being talked about," but did not say how many were affected.

The company is under pressure to act decisively, with German Chancellor Angela Merkel urging it to quickly restore confidence in a business held up for generations as a paragon of German engineering prowess.

"There will be further personnel consequences in the next days and we are calling for those consequences," Volkswagen board member Olaf Lies told the Bavarian broadcasting network.