Volkswagen’s supervisory board to extend CEO Martin Winterkorn’s contract

Article by Christian A., on September 9, 2010

Saying that the CEO has “advanced the company in every respect,” Volkswagen AG’s supervisory board plans to extend CEO Martin Winterkorn’s contract by several more years, according to Bernd Osterloh, head of the carmaker’s works council.

Osterloh, who serves as the board’s deputy chief, revealed this plan to workers at VW’s headquarters in Wolfsburg, Germany. On Jan. 1, 2007, Winterkorn took over from Bernd Pischetsrieder.

The 63-year-old Winterkorn had previously served as the CEO of VW’s Audi luxury unit. It’s typical for German CEO contracts to run for five years. The supervisory board decides on whether to extend the contract about a year before it is set to end.

Winterkorn aims to beat Toyota Motor Corp. in sales and profitability by 2018. The CEO targets a pretax profit in 2018 that surpasses 8% of sales, compared with 1.4% in the first three quarters of 2009.

For the first half of the year, VW was able to boost sales by 15% to over 3.5 million cars and sport-utility vehicles worldwide. In this period, sales of VW brand vehicles surpassed 2 million. Volkswagen spokesman Michael Brendel declined to comment on this report.

Winterkorn is supported by Lower Saxony, the German state with a 20% stake in VW and the authority to veto major decisions. In a June interview, designated Prime Minister David McAllister told Bloomberg that they are in support of Winterkorn’s goal to make VW No. 1 in the auto market worldwide by 2018.

Last January, Volkswagen paid $2.5 billion for a stake in Suzuki Motor Corp. to expand in India. It is also about to take over Porsche SE’s sports-car making operations, bringing its number of marques to ten. VW’s marques include Skoda, Seat and luxury brands Audi, Lamborghini and Bentley. [via autonews - sub. required]

Topics: vw, ceo

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