At least three members of Volkswagen's board said they were left in the dark about the company's emissions cheating for two weeks after top executives admitted the deception to American environmental officials.
During that period, the board was completing the terms of a contract extension for the automaker's chief executive, Martin Winterkorn. He was pushed out five days after the use of the cheating device became public, though he insisted he had known nothing about it.
The board members' statements shed new light on flaws in the management structure and lines of communication at Volkswagen, the world's largest automaker. Volkswagen's stock has lost about a third of its value since September 18, when the cheating was made public by the United States Environmental Protection Agency.
Volkswagen has admitted that some cars were programmed to disable their pollution controls unless the software detected that emission tests were being conducted. With the controls off, the vehicles had better acceleration and fuel economy, but emitted far higher levels of nitrogen oxide.
If Winterkorn did not know about the communication with the American regulators, he was unaware of a fundamental threat to the company. If he was aware, he withheld significant information from members of his 20-member supervisory board. "That they were not informed about a problem of this dimension, that points to a huge communications problem," said Markus Kienle, a Frankfurt lawyer who is on the board of a shareholder-advocacy group known by its German initials SdK.
Winterkorn did not respond to requests for comment. A spokesman for Volkswagen declined to comment.
Stephan Weil, a board member who is also prime minister of the German state Lower Saxony, where Volkswagen is based, said he learned of the cheating while watching television news. Babette Fröhlich, another board member and an official with the IG Metall labour union, said she also learned of the scandal from the media. A third board member, Olaf Lies, the Lower Saxony economy minister, has said he was not informed by company officials and read about it online.
The board's executive committee, which includes Weil, had formally recommended to the full board the extension of Winterkorn's contract by three years. That recommendation was made on September 2, the day before Volkswagen officials told EPA about the emissions cheating.
It was a "grave mistake" for Volkswagen executives to withhold information as long as they did, Weil said in a statement. He noted that American regulators had raised red flags about Volkswagen emissions in 2014. "Talks took place for a full year before Volkswagen admitted the deception," Weil said. "This confession should clearly have occurred much earlier."
Critics of the company previously have said that top managers in Wolfsburg, Germany, where the company is based, hoarded power while discouraging open discussion of problems. Matthias Müller, Volkswagen's new chief executive, has acknowledged the flaws and promised a more open style of management, although changing a company with 600,000 employees could take years.
The consequences for Volkswagen have been severe. About 11 million cars have the illegal software, mostly in Europe and the United States, and recalling or repairing them is likely to cost billions of dollars. The company faces dozens of lawsuits on both continents from shareholders and customers. Volkswagen has suspended five high-ranking executives who were involved in motor development and is conducting an inquiry.
After the Environmental Protection Agency made public its accusation, Winterkorn acted to quell the crisis. He publicly apologised on behalf of the company. Those moves did not save him from the angry board. The next day he was out of a job. "I am stunned that misconduct on such a scale was possible in the Volkswagen Group," Winterkorn said in a statement accompanying his resignation. "I am not aware of any wrongdoing on my part."
Some outsiders expressed surprise that Winterkorn, known for his attention to detail, would have been unaware that EPA officials had been asking for more than a year why Volkswagen diesel cars had far lower emissions in laboratory tests than on the road. "I find it very improbable," said Ferdinand Dudenhöffer, a professor at the University of Duisburg-Essen who follows Volkswagen closely. "He was always the one who wanted to know everything."
©2015 The New York Times News Service
