Receiving a vote of no confidence from the steering committee of Volkswagen's (VLKAY.PK) supervisory board, CEO Bernd Pischetsrieder quit late on Tuesday after a 6 to 0 vote. It's a little bit of an odd move since they just renewed his contract for another five years to 2012 - just six months ago.
If agreement can be made at the upcoming November 17 board meeting, Martin Winterkorn, the head of Audi, will take over as chief executive at the start of 2007.
Guido Reinking, industry analyst with Automobil Woche, said there were no reasons for Pischetsrieder to step down. "They are gaining market share in Europe and they are gaining market share in the USA, the American market is getting better now for VW, so globally they are on a good track, so there is no figure in the quarterly figures which says Pischetsrieder did not do a good job.”
One inside source said that an argument started over the speed of restructuring in the company and Pischetsrieder got tired of it and quit.
Other analysts agreed with this saying that Pischetsrieder wasn't aggressive enough in executing the recovery program.
This is one reason why I would prefer to manage or be an executive in a privately owned business rather than a public one. To focus on the short-term does more harm, in my experience, than making plans based upon long-term success. To me this seems like a bad move by Volkswagen.
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