Bernhard Maier, CEO of Volkswagen Group's Skoda brand, will leave his post after nearly five years at the end of July.
Maier's successor will be elected by the board in August, Skoda said in a release on Thursday.
Skoda declined to say whether Maier, who is 60, will move to another post within VW Group.
"Talks on this matter are currently underway," a spokesman told Automotive News Europe.
Thomas Schaefer, head of VW Group's operations in South Africa, is the favorite candidate to succeed Maier, Automobilwoche, a sister publication of Automotive News Europe, reported, citing company sources. Schaefer, 50, started his career at Daimler and moved to VW in 2012.
Another candidate is Martin Jahn, head of sales and marketing at the FAW-VW joint venture in China. Jahn was an economic minister in the Czech government before joining VW in 2006.
VW Group CEO Herbert Diess, who is Skoda's chairman, said in the release that Maier's years at Skoda were among the most successful in the company’s 125-year history.
"I would like to thank Bernhard Maier for this and almost two decades of particularly successful years, first at Porsche and then at Skoda," he said.
Maier was named an Automotive News Europe Eurostar in 2018 after steering Skoda to record profits and vehicle sales. He has also overseen a massive rollout of new Skoda models, including multiple SUVs.
The change at Skoda comes amid a broader management shuffle at the VW Group.
VW earlier this week announced that its trucks chief, Andreas Renschler, would retire and said in June that CEO Herbert Diess would hand responsibility for managing the VW brand to Ralf Brandstaetter.
German magazine Auto Motor und Sport said in June that Maier was a candidate to become Porsche CEO. Maier was sales and marketing boss at Porsche before becoming Skoda CEO in 2015.
Skoda has boosted annual deliveries above 1 million in recent years but like other automakers it has been hit hard by the coronavirus outbreak. Its vehicle sales fell 14 percent to 237,000 in the first quarter. Operating profit dropped by 103 million euros to 307 million euros, according to a VW Group statement released on April 29.
Reuters contributed to this report