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Why VW's Berhnard Didn't Resign

Posted by: Gail Edmondson on November 20, 2006

So what happened? Turnaround ace Wolfgang Bernhard hasn’t resigned at Volkswagen. His departure was widely expected last week in the wake of CEO Bernd Pischetsrieder’s ouster and the appointment of Audi boss Martin Winterkorn as new CEO. A VW board member told AutomobileWoche (AutoWeek) that VW is trying to convince VW brand boss Bernhard to stay. That’s the first indication that the powerful and mercurial Supervisory Board Chairman Ferdinand Piech, who orchestrated Pischetsrieder’s departure, may yet be serious about accelerating VW’s overhaul.

Winterkorn’s plan to restructure the grouping of VW’s seven brands in two clusters — mass market and premium — also makes sense. Piech and Winterkorn just need to figure how Bernhard can play a strong role in the new organization. VW, which still loses money on cars built in its German factories, can’t afford to see Bernhard’s cost-cutting efforts slowed or derailed. And engineering-driven VW needs a manager with Bernhard’s market savvy.

Winterkorn and Bernhard have a cool relationship, but the duo flew to China together for the Beijing auto show. Many German auto executives are still betting Bernhard will go, but it will be a coup for Piech and Winterkorn if they convince him to stay.

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