VW CEO Herbert Diess Abruptly Replaced by Porsche Head Oliver Blume

Herbert Diess is leaving his position as chief operating officer with Porsche CEO Oliver Blume taking his place according to reporting by Bloomberg.

Diess was brought on as CEO in 2019 as the brand was reeling from billions of dollars in fines and a loss of customer confidence due to the Dieselgate scandal. At the time, he was known for cost-cutting strategies, which have since brought him into frequent conflict with labor unions over the years. Today, he's often credited with leading VW's rapid push into electrification, launching the ID 3 and ID 4 during his time as head of the second-largest automaker in the world. Even Elon Musk praised the man whose goal it was to catch up to Tesla.

2021 VW ID 4 in the wild

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On Friday, VW's supervisory board voted to remove Diess from his position with sources citing differences over the CEO's communication style, frequent clashes with labor groups and strategic missteps.

Taking over as VW lead is Oliver Blume. Blume has served as CEO of Porsche since 2015 -- replacing Mathias Muller... who went on to head VW before being replaced by Diess a few years later. Under Blume, Porsche has seen its own electrification push. The brand set a global sales record last year thanks to a ramp up in Taycan production. The electric sports sedan would go on to sell 41,296 units worldwide in 2021, outselling the brand's iconic 911 sports car.

According to a mutual agreement between Diess and VW's board, the changing of the guard will take place on Sept. 1, 2022 with Diess voluntarily stepping down and Blume taking charge. Blume will retain a concurrent position as Porsche head.