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Volkswagen rushed revamp triggers labour concern: sources

Reuters  |  BERLIN/MUNICH 

BERLIN/(Reuters) - Labour representatives at are concerned by a sudden rush by the German carmaker's board to approve sweeping changes on Thursday, sources said, while reported that its chief could step down.

As part of what could be the biggest shake-up at in a decade, is due to be replaced by Herbert Diess, of core autos brand, who has repeatedly clashed with unions over cost cuts.

announced the change on Tuesday in a short and cryptic statement, abruptly ending the reign of Mueller who took over at a week after it was plunged into its biggest-ever corporate scandal.

Other changes before the board include a public stock market listing of truck and bus division, a management board seat for a and a reorganisation of its 12 brands into four categories, sources said.

Volkswagen's efforts to reform have often been stifled by powerful labour unions who command half of the seats on the board of directors, and the German state of Lower Saxony, which controls a 20 percent voting stake.

shares were up 2.5 percent ahead of the board meeting due to start at 1400 GMT on Thursday at the carmaker's Wolfsburg base, and were one of the top gainers on the German blue-chip DAX.

"Nobody knew anything," a source at one of brands told "What's going on there is plain folly."

"The way in which changes of such a magnitude were communicated internally is more than questionable," a source close to supervisory board said.

Sources close to said the controlling Porsche-Piech families and Lower Saxony had decided they could not afford to wait because of the risk of the changes being leaked.

They had brought Thursday's board meeting forward from Friday afternoon for the same reason, the sources said.

German business daily reported that Chief was enraged about how the supervisory board had piloted the changes and that there was a risk that he could step down, citing unnamed sources at

Witter did not want to comment, a said, while the carmaker's headquarters and works council declined comment.

The management reshuffle could affect other senior executives, a source told on Wednesday.

(Reporting by Irene Preisinger, Andreas Cremer, and Ilona Wissenbach; Editing by and Alexander Smith)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Thu, April 12 2018. 20:05 IST