Volkswagen’s new boss faces the connected car project

The biggest challenge is clearly software“, abstract Matthias Schmidt, industry analyst. In other words: the transformation of cars into computers on wheels, the second big step besides electrification.

The current CEO Herbert Diess has already launched the group with twelve brands in an electric shift unparalleled in the world of “old“Builders – well positioned to become the market leader in 2025.

But to catch up with the Tesla, listed as a model, vehicle programming is more complex.

Difficulties at the Cariad subsidiary responsible for developing these systems have delayed several flagship projects. They triggered the end of the mandate of Herbert Diess, who intended to transform Volkswagen into a technology giant.

The ambitious goal: to program as much code as possible in-house, without depending on software bought elsewhere, thus keeping track of the nerve center of the car of the future and the economic benefits that come from it.

Oliver Blumemust decide whether to continue following Herbert Diess’s plan (…) to do it internally or whether to make a major strategic change“by trusting suppliers”to live with the consequences of seeing these sources of profit disappear“, Mr. Schmidt notes to AFP.

The plan to make everything central will probably be reworked“, says the expert Ferdinand Dudenhofer.

harmful confrontation
Another project: to repair the stormy relationship between management and unions, which has weakened H. Diess for months.

The Austrian’s divisive personality and the accumulation of internal conflicts are the main underlying reason for the hasty departure, confirms a source in the group.

The announcement was surprising for the timing. But the future of the Volkswagen boss seemed for a while now to be compromised. Some of its powers had already been reduced earlier.

H. Diess”had enemies“and”was neither held by politicians nor work committees“, remarks F. Dudenhöffer.

Signs of rejection: The board unanimously approved his departure.

Turning the page on the scandal”diesel port“rigged motors and start electrification,”it was very important to move towards confrontation because the group had to be transformed“, remarks F. Dudenhöffer.

But now, “it is to seek“the decisions.

For this, confrontation is harmful“, judges the expert. Even if, with H. Diess, “a breath of fresh air disappears in Wolfsburg“, H. Diess have had”the courage to try“, answers Mr. Schmidt.

Close to the Porsche-Piech families that control the group, Oliver Blume – unlike H. Diess, who arrived from BMW – is a pure product of Volkswagen: “probably not what Volkswagen needs right now“, cuts the analyst.

Continuity
Reputation more”cooperative”, according to F. Dudenhöffer, O. Blume will take over the helm of the German giant on 1 September.

He will continue Herbert Diess’ major strategic projects“, assesses the expert, especially the investments in the manufacture of electric battery cells, the construction of a new factory near the historic headquarters and the development of mobility services with Europcar.

Signs of some continuity: the finance director Arno Antlitz will also have access to the functions of Chief Operating Officer (COO).

According to a source close to the board, Herbert Diess will continue to work for Volkswagen until the end of his contract in 2025 – as an “advisor”.

To keep the leadership of Porsche for the time being, Oliver Blume will finally have to complete the initial public offering (IPO) of the racing car subsidiary, scheduled for the 4th quarter in an already cool market context.

I think he will stay in Porsche“until the IPO, notes Mr. Schmidt, before”focus on managing the group and its many tentacles“.

The future boss”will be judged on Volkswagen’s success in China“and in the USA, two key markets where the group is weakened, recalls F. Dudenhöffer.

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