Pich V. Winterkorn Row Triggered By VW Dieselgate Scandal: Report
Former Volkswagen chairman Ferdinand Piëch resigned his position a month after questioning and failing to get answers from ex-CEO Martin Winterkorn about the company’s defeat devices, an internal probe revealed.
The finding from the investigation by U.S. law firm Jones Day was published in the German newspaper Bild am Sonntag, Bloomberg reports, shedding light on the power struggle that preceded the diesel emissions scandal.
In March of 2015, Volkswagen was already being investigated by the U.S. Environmental Protection Agency. According a report in Bild, when Piëch cornered Winterkorn after the Geneva Motor Show, the CEO responded to his questions about the investigation by saying he had it all under control.
That interaction caused a widening rift between the two executives, who had once been very close. A feud broke out, with Piëch publicly questioning Winterkorn’s authority and scraping any plans to appoint him as his successor. Ultimately, Piëch resigned as chairman of Volkswagen AG’s supervisory board in April, 2015.
Winterkorn stepped down almost immediately after the scandal went public in September. The ex-CEO is now under investigation by German investigators, along with brand chief Herbert Diess. The probe aims to find out what knowledge either man had of the emissions deception, and when.
Evidence suggests that Winterkorn may have known of the looming scandal in May of 2014, a year before his falling out with Piëch. A memo detailing the International Council on Clean Transportation study, which blew the lid off of the deception, landed on his desk on May 23 of that year. He also attended a meeting during the summer of 2015 where the issue was mentioned.
Piëch never revealed the reason for his split with Winterkorn, only saying that he didn’t approve of the executive’s U.S. product strategy.
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Scraping...scrapping...two different words.
A lesson can be learned from the study of the loss of Challenger and Columbia shuttle orbiters. In both cases, what on the surface appeared to be an engineering failure was actually a management / political failure. In both cases you had a vehicle operating to engineered specifications, but exhibiting anomalies that the technical team warned management about. In both cases you had management who essentially said, "damn the torpedoes, full steam ahead" and accepted these anomalies as acceptable risks. Much like the financial shenanigans leading up to the financial crisis in 2008: it worked....until it didn't. And then when it failed, it did so catastrophically. Richard Feynman said it best: "For a successful technology, reality must take precedence over public relations, for nature cannot be fooled." Volkswagen, like NASA of the 1980s and again in the early 2000s, has spent years ignoring reality. Management ignored the facts and felt that they could simply 'will' things into existence: be it faster and cheaper launch rates without compromising safety at NASA or cleaner burning diesels at Volkswagen. At NASA corporate culture was ultimately blamed for the failure, and I suspect that when Jones Day finishes up their analysis at VW, we'll find the same thing here. Piech is extremely crafty. You can be sure that when he got a whiff of what was going on with emissions in the US he knew the gig was up and that the bottom was about to fall out. He got out when the getting was good.