FRANKFURT -- Volkswagen Group's top committee on Tuesday avoided discussing a potential contract extension for CEO Herbert Diess, reports said.
A supervisory board panel ended a three-hour meeting without a concrete proposal for defusing internal tensions over Diess's desire for a contract extension and more dramatic changes at the automaker.
More talks are required ahead of a meeting of the full supervisory board next week, according to people familiar with the outcome of Tuesday’s gathering.
Discussions about Diess, 62, and selections for top management posts will continue in the coming days, said the people, who asked not to be identified because the conversations are private.
Diess had demanded a vote of confidence in his reform efforts by asking for an early contract extension even though labor leaders at the company opposed the move.
VW declined to comment.
"The executive committee will not be pressured into a decision, there is no rush," one of the people familiar with the matter said, commenting on the potential contract extension.
The committee is headed by Volkswagen's chairman Hans Dieter Poetsch. It includes Wolfgang Porsche and Hans Michel Piech, members of the automaker's owning families who control a majority voting stake, as well as VW labor boss Bernd Osterloh.
Ahead of the meeting on Tuesday, Diess outlined his vision for reforming VW, saying he had not succeeded in overhauling its German operations where labor chiefs can block significant decisions.
"The families continue to support Diess," a spokesman for Porsche Automobil Holding SE, the company which holds a majority voting stake in VW, said ahead of the meeting on Tuesday.
Diess defected from BMW in 2015 and helped VW reform after its diesel scandal with a 73 billion euro ($87 billion) electric vehicle investment plan. However, he has grown frustrated with opposition to cost cuts.
A dispute over who should fill openings for jobs including the finance and purchasing chiefs and Diess’s push to reshape VW spilled into the public last month.
Diess wrote a newspaper op-ed in which he referred to the German industrial giant still having "old, encrusted" structures that must be broken up.
Diess's attempts to install allies Arno Antlitz as chief financial officer and Thomas Schmall as chief procurement officer on the management board are opposed by Osterloh, sources told Reuters. Antlitz is currently Audi's finance chief. Schmall is head of VW's components division.
Diess has floated the idea of staying on as CEO beyond his current mandate through April 2023, according to people familiar with the situation, even though his contract would normally be up for renewal a year before it ends.
Analysts said the potential crisis at Volkswagen highlighted the difficulties of reforming a company where labor representatives control half the seats on the board of directors and local politicians have a 20 percent voting stake, allowing them to vote down strategic proposals.
VW Group is worth 77.2 billion euros ($92.4 billion), far below rival Toyota's market value of $155.7 billion and Tesla's $555 billion. That is despite the fact that VW sold 10.96 million vehicles last year - the most by any automaker around the globe - while Toyota came in second with 10.74 million. Tesla sold only 367,500 cars in the same period.
VW Group had 671,205 employees at the end of 2019, compared with 359,542 at Toyota at the end of its fiscal year, and 48,016 at Tesla last year.
Reuters and Bloomberg contributed to this report
