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VW CEO Rejects Market Manipulation Allegations

main source Uli Deck DPA – VW Volkswagen CEO Matthias Mueller Detroit auto show January 2016 53380582
Under investigation. Picture source: DPA

Volkswagen Chief Executive Matthias Müller, in an exclusive interview with Handelsblatt, has rejected allegations by state prosecutors that he and other VW leaders engaged in market manipulation by failing to inform Porsche SE shareholders about the diesel emissions scandal in a timely manner.

Mr. Müller said he and his co-accused, former VW CEO Martin Winterkorn and Supervisory Board Chair Hans Dieter Pötsch, fulfilled all legal obligations to publish information relevant to capital markets in a timely manner.

“I reject the allegations of the state prosecutor,” Mr. Müller told Handelsblatt.“I will do everything I can to make sure that the facts of the case are cleared up in a speedy and transparent manner,” he added.

Mr. Müller also revealed that he is currently in talks with the supervisory board about who should succeed him as chief executive when his contract expires in 2020.

The state prosecutor’s office in Stuttgart on Wednesday confirmed that Mr. Müller was under investigation on suspicion of market manipulation. Handelsblatt’s sister publication, WirtschaftsWoche, reported the story a week before authorities confirmed the investigation.

“Of course it would be desirable if these things pass quickly,” Mr. Müller said of the investigations. “It always creates some renewed degree of uncertainty for everyone here at the company.”

Also under investigations, albeit for other reasons, are the members of Volkswagens works council. Braunschweig prosecutors are investigating whether labor chief Bernd Osterloh had for years received an inflated pay package. Mr. Osterloh, who represents the carmaker’s 620,000 employees in every negotiation about its restructuring, receives a renumeration close to the level of a senior manager at the company. Besides his base salary of €200,000 ($218,650), he gets a bonus that easily totals another half million euros in a good year.

“We expect that the renumeration is in line with all legal provisions,” Mr. Müller said in reference to the labor head, adding that his pay had been established by an external expert.

Mr. Müller also revealed that he is currently in talks with the supervisory board about who should succeed him as chief executive when his contract expires in 2020. He declined to name specific candidates, but was clear that VW would give preference to internal candidates.

“It would be important and a message for the company if my successor came from our own ranks,” Mr. Müller said, adding that Volkswagen overall had to become “more international, more female and younger.”

Mr. Müller previously led luxury automaker Porsche and took over the reigns at VW after his predecessor, Martin Winterkorn, resigned in the wake of the diesel emissions scandal in September 2015. So far, VW has paid more than $20 billion to settle claims by regulators and diesel owners in the United States.

Mr. Müller was keen to emphasize that the group’s corporate culture has taken a turn for the better since he took the helm. Critics had said that pressure on employees under Mr. Winterkorn was unusual, describing a climate of fear and authoritarianism.

“Indeed, today’s board is collaborating in a completely different way,” Mr. Müller told Handelsblatt. “In the past, board meetings were more of a one-man show. Many decisions weren’t made by the board, but by other small groups. Now, we are a team that openly deals with one another. Criticism is welcome.”

Read the full interview in Handelsblatt Global.