Report – VW seeking further cost cuts, former CEO to quit all remaining posts image

Volkswagen Ag, the world’s largest automaker by sales after the first six months of the year, has been massively impacted by the biggest crisis in its 78-year history, triggered by the revelation it cheated on diesel emissions tests.

German newspaper Handelsblatt has recently reported the company is now seeking further cost cuts, including form its suppliers. The lump sum could be of 3 billion euros ($3.41 billion), achieved through price cuts, and would be used to help pay the costs stemming from the emissions scandal. The German daily cited company insiders in claiming the cost cutting measures would form part of a broader strategy to reduce expenses, which could also tap into wages, marketing, sponsoring activities and other venues to help it fend off the rising costs stemming from the scandal, estimated now at over 40 billion euros. Europe’s biggest carmaker, now headed by new chief executive officer Matthias Mueller, is already reserving 6.5 billion euros in the third quarter to cover fixes and related costs after acknowledging it had cheated diesel emission tests. Mueller also said recently the company would delay or postpone indefinitely all non-essential programs.

In related media reports it also appears that former CEO Martin Winterkorn, who decided to give a clean slate to the company and resigned his group commission last month, is also getting ready to step down from other posts he retained in or around the German carmaker. The Sueddeutsche Zeitung newspaper and TV stations NDR and WDR reported the news, but cited no sources, claiming the resignations would arrive in a matter of days, after formalities are completed.

Via Reuters