BERLIN (AP) - Top directors at German carmaker Volkswagen plan to give a two-year contract extension to CEO Martin Winterkorn, who emerged on top of a power struggle this year with company patriarch Ferdinand Piech.
BERLIN (AP) — Top directors at German carmaker Volkswagen plan to give a two-year contract extension to CEO Martin Winterkorn, who emerged on top of a power struggle this year with company patriarch Ferdinand Piech.
The automaker said Wednesday that the executive committee of its supervisory board agreed to propose to the full board that Winterkorn be granted a contract through the end of 2018 at a meeting scheduled for Sept. 25.
Piech, for years Volkswagen's dominant figure, resigned as board chairman in April. He said in an interview that he was "at a distance" from Winterkorn, but the CEO obtained support from other board members.
The extension would keep Winterkorn, who is 68, on the job until he is 71.
Piech did not outline publicly his reasons for falling out with Winterkorn. Volkswagen is profitable and achieved its goal of passing Toyota as the world's largest carmaker over the first six months of this year. But the company has struggled to reduce costs and improve market share in the United States.
It now faces slackening demand in China, which is a key source of sales and profits, as well as headwinds in economically troubled Brazil and Russia.
The company is implementing a new modular assembly technique that promises costs savings and more flexible manufacturing.
Profits slipped in the second quarter, to 2.73 billion euros ($3.08 billion) from 3.25 billion euros.
The company has yet to choose a permanent new board chairman. Piech's former deputy, Berthold Huber, a former leader of Germany's biggest industrial union, is the interim chairman.
Volkswagen AG's brands include Audi, SEAT, Skoda, Bentley, Lamborghini and Porsche.