VW of America CEO's Days Were Numbered, Even If He Wasn't To Blame For Diesel Cheating Scandal

Michael Horn, President and CEO Volkswagen Group of America, is leaving the company immediately. (Photo by Bill Pugliano/Getty Images)
Michael Horn, president and chief executive of Volkswagen Group of America, is leaving the company “by mutual agreement,” the embattled automaker announced this afternoon.
Horn’s departure could be a sign that the diesel emissions scandal that has rocked the German automaker, tarnishing the reputation of one of Germany’s most renowned corporate brands and destroying 30 percent of its market value, is coming to a head.

Earlier this week, Volkswagen CEO Matthias Mueller told employees in Germany that the emissions scandal would inflict “substantial and painful” financial damage on the carmaker, which has delayed publication of its annual results until April 28. The company’s labor boss also warned workers that substantial job cuts, including in the United States, could result, depending on the size of the expected fine from the U.S. government. Meanwhile, German prosecutors said they are now investigating 17 employees, up from six previously, for their role in the controversy.
Horn has never been implicated in the scandal, and in fact, was instrumental in helping steer VW through the early days of the crisis, facing a hostile mob of journalists the day after the charges became public and famously admitting,“We totally screwed up.”
Even after the automaker inserted an executive above him to oversee VW’s entire North American business, U.S. dealers lobbied hard – and won – to keep Horn in charge of day-to-day operations.

But as the carmaker looks to clean house and regain its reputation, it really had no choice but to part ways with Horn. VW said the 25-year veteran is leaving the company immediately to pursue other interests. Herbert Diess, CEO of the Volkswagen brand, praised Horn’s tenure during a difficult stint. “I want personally to say ‘thank you’ to Michael Horn for the great work he has done for the brand and with the dealers in the United States. During his time in the U.S., Michael Horn built up a strong relationship with our national dealer body and showed exemplary leadership during difficult times for the brand.

Horn, 54, ran the U.S. operation since the beginning of 2014. His role will be filled, at least on an interim basis, by Hinrich Woebcken, the newly named head of Volkswagen’s North American regional operations.
The U.S. Justice Department has sued VW for up to $46 billion for breaching U.S. environmental laws by rigging diesel-powered cars with software that would enable them to pass strict emissions tests even though pollution was much greater under normal driving conditions. More than 500 lawsuits have been filed against the company in the United States, and VW has yet to come up with a fix for nearly 600,000 cars affected here. U.S. authorities rejected its first proposal.
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