The company announced on Friday that Chief Executive Herbert Diess will be replaced by Oliver Blume, head of Volkswagen's Porsche Performance division. Volkswagen, the world's second-largest carmaker, did not give a reason for Diess' departure.
But a Reuters report, citing unnamed sources, said the Porsche and Piech families - who between them own the majority of voting rights at Volkswagen - were seeking a change in leadership. The company did not immediately respond to a request for comment on the allegations.
CNN assesses that this has been a busy and challenging mandate for Diess. He took over the management of the company in 2018, after the "dieselgate" scandal, which forced the company to pay huge American and European fines for false readings of harmful gas emissions.
Nevertheless, he managed to put that scandal "in the rearview mirror" of the company and focused on electric vehicles more than many established car manufacturers, positioning Volkswagen at the very top of the new industry.
VW said it will spend 89 billion euros over the next five years on the development of electric vehicles, about half of its planned spending in that period, and aims for electric vehicles to represent a quarter of sales by the end of 2026.
The number of battery electric vehicles sold by VW almost doubled in 2021 to nearly 453,000 globally, placing it in 3rd place behind only Tesla and General Motors. "Herbert Diess played a key role in advancing the transformation of the company.
The Group and its brands are sustainable for the future; its innovative capabilities and earning power have been strengthened," said Hans Dieter Pötsch, CEO of the company. "Not only did he lead the company through extremely turbulent waters, but he also fundamentally applied a new strategy," he added.
But not all was rosy. While Volkswagen may be further along than most traditional automakers in the planned switch to electric vehicles, it has fallen further behind Toyota in the race for total vehicle sales — a key metric in this sector.