BERLIN -- Herbert Diess will take over from Matthias Mueller as CEO of the Volkswagen Group, adding fresh impetus to the company's efforts to slim down and reorganize the way its 12 brands are managed.
The automaker said it will create six new business areas and a special portfolio for China, its largest market, and split its brands into three new vehicle groups with categories for value, premium and super-premium nameplates.
The announcement was made after Volkswagen directors ousted Mueller and deliberated ways to reform an empire which has motorcycle, bus, truck and passenger-car brands including Ducati, Bentley, Porsche, Audi, Scania and Skoda.
VW replaced Mueller after he failed to refocus the group's portfolio of car brands, a key pillar of the company's Strategy 2025 plan that is supposed to transform the company into a leader in cleaner cars after the diesel-emissions cheating scandal of 2015.
Diess, the current head of VW’s namesake brand, will also oversee VW Group r&d and information technology, the company said.
Mueller, who has held the CEO post for less than three years, is stepping down immediately.
Diess’s appointment will be key to reassuring investors that the highly centralized German industrial behemoth is determined to reform itself. Excessive spending and poor budget discipline were eroding profit margins even before the automaker’s diesel scandal erupted.
His tenure will be judged early on by whether he can scale up a revamp of the VW nameplate to the entire 12-brand group and prepare for an era of battery-powered and autonomous vehicles.
