FRANKFURT -- Former Volkswagen Chairman Ferdinand Piech is challenging VW's choice of two of his nieces to replace him and his wife as supervisory board members, a German newspaper said.
Piech is nominating Wolfgang Reitzle, a former BMW product chief and ex-head of Ford's now-defunct Premier Automotive Group, along with former Siemens manager Brigitte Ederer instead, German daily Bild said on Thursday, without citing sources. Reitzle is seen as a potential VW chairman, the paper said.
Earlier in the day, VW said Louise Kiesling and Julia Kuhn-Piech will fill the board slots vacated last week when the former VW chairman and his wife, Ursula, quit after Piech lost a showdown he had provoked with CEO Martin Winterkorn.
Kiesling and Kuhn-Piech were appointed to VW's 20-member supervisory board at the request of the carmaker's management board that is led by Winterkorn, VW said in a statement. VW said the appointments were approved on Thursday by the Brunswick local court with immediate effect.
A VW spokesman told Automotive News Europe that the appointments had been made and he had no knowledge of any objection aside from the Bild report.
On Friday, Volkswagen's works council, which controls half the 20 seats on the supervisory board and was instrumental in forcing Piech to stand down, backed the automaker's choice of new board members.
"We welcome this step to complete the supervisory board and are looking forward to co-operating with Mrs Kiesling and Mrs Kuhn-Piech," a labor spokesman said.
A company source said that the choice of Kiesling and Kuhn-Piech as new board members was not made by Ferdinand Piech but "coordinated with the entire family."
In Germany any shareholder, the works council and the company itself are entitled to nominate a new member to fill a vacancy on the supervisory board via a court, a source familiar with the matter told Reuters, citing the law on stock companies. The company is the only party of the three obliged to do so, he added.
For Piech the only way to thwart the VW appointments would be to bring legal action against the court ruling, the source said. The Bild report suggested Piech is contemplating action against his own relatives.
Piech opposes the appointments because Kiesling and Kuhn-Piech have limited auto industry experience, Bild said.
The two new board members will now be thrust into the spotlight as they look to supervise a company with a dozen brands, 200 billion euros in annual revenue and 600,000 employees.
Kiesling, 57, is the great-granddaughter of Porsche founder Ferdinand Porsche. She is an Austrian businesswoman who received a doctoral degree in vehicle design at the Royal College of Art in London. Kuhn-Piech, 34, is the daughter of Ferdinand Piech's younger brother, Hans-Michel Piech, a VW board member who is a lawyer in Vienna. She works in real estate.
In September 2014, Kiesling bought an over 165-year old Austrian textile manufacturing company with 80 employees called Backhausen, which supplied high quality materials used in the hotels in the Olympic Village in Sochi, Russia. “Dr. Louise Kiesling has not only taken over the management of the company, she is responsible for product development and creative direction,” Backhausen said in a statement earlier this year.
Kuhn-Piech completed her law degree in Vienna before studying property and realty management at the Technical University in the Austrian capital.
Balance of power
The appointment of the Piech nieces restores the balance of power that favored the Piech clan on the VW board. Once more the Piech side has three board members, including Hans-Michel, while the Porsches have two members – Wolfgang Porsche and his nephew Ferdinand Oliver Porsche. The Porsche-Piech clans control nearly 51 percent of VW’s ordinary shares through their listed holding vehicle, Porsche SE.
VW's statement did not mention the length of the appointments. Typically, appointees serve out the rest of their predecessor’s term, which would be until 2017. To serve a full five-year term on the board, a director usually has to be elected by the company’s owners at a shareholder meeting.
Piech, 78, and his wife quit the VW board on Saturday when he lost the support of key VW power players after he tried to remove Winterkorn as CEO. Piech is a grandson of Ferdinand Porsche and has been a leading figure at VW for more than two decades.
Piech's departure has left a void at the top of Europe's largest automaker. The Bild report will cause new strains at the carmaker ahead of what is likely to become a tense annual shareholder meeting next Tuesday. Ex-union boss Berthold Huber, VW's interim chairman, will lead the meeting in Hanover.
Reuters and Bloomberg contributed to this report