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Volkswagen Group’s allegedly autocratic former culture proving hard to change

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Volkswagen Group CEO Matthias Mueller has admitted that the near-autocratic corporate structures that lied about diesel emissions and shattered the company’s reputation is proving hard to break apart.

A report from Reuters this week, run by Automotive News Europecontained some remarkably frank quotes from the former Porsche AG chief, who was appointed Group chief shortly after the diesel scandal broke in September 2015.

“There are definitely people who are longing for the old centralistic leadership,” Mueller said during a discussion with business representatives. “I don’t know whether you can imagine how difficult it is to change the mindset”.

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It’s no secret that there was an ingrained highly deferential attitude to authority in Wolfsburg, led by an aloof command-and-control culture headed-up by former chiefs Martin Winterkorn and Ferdinand Piech.

Critics have long said that this lack of openness may have contributed to the diesel emissions cheat code scandal – something that gained legs when Mueller immediately made it a priority to decentralise power and create a more humble and open corporate culture and face when he took the reins.

But Mueller admits to having a hard time.

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“You are permanently caught in a field of tension based on the question of how much [decentralisation] can the company tolerate and how much can it not,” he was reported as saying.

“The process [of change] has been started but it’s a process. One now has to endure this, also as chief, that some things go wrong and some things remain unsuccessful while other things are successful.”

More sensationally, Reuters cited VW sources as saying that many mid-level managers thrived under pre-scandal non-accountable arrangements that allowed them to essentially shift responsibility to others.

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Many managers are also alleged to be focusing on protecting themselves rather than providing leadership in their departments – leadership needed as VW AG embarks on one of the world’s most ambitious electrified vehicle programs.

“The search for those who made mistakes always took precedence over the search for the mistakes,” one VW source said. “That mindset is still there.”

Mueller said it previously took him three years as CEO of Porsche around 2008-09 to establish a new culture for its workers and shift the focus back to the product.

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“Of course there are anxieties, it’s not an easy undertaking [to overcome VW’s management hierarchies],” he said. “The only question is how long will it take?”

Author note: If we were to read between the lines here, we’d suggest that Mueller is using the court of public opinion to show Volkswagen shareholders and investors that change is underway. Slowly.

MORE: Volkswagen news, reviews, comparisons and videos



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About Mysterious Everythings

Le Minh Hieu is a national-level weightlifter and a Singapore Weightlifting sports performance coach. Hieu's biggest passion is helping everyone find confidence, happiness, and health through fitness.