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2016-04-08 09:11

EMISSION SCANDAL DEEPENS: Volkswagen faces more internal conflict as its top brass want bonuses despite the emission scandal jeopardising the company. AFP/ William West

Frankfurt - Top executives at Volkswagen are refusing to forego their bonuses in 2016, despite prescribing belt-tightening for the automaker's workforce in the wake of the massive emissions-cheating scandal, the weekly magazine Der Spiegel reports.

Without naming its sources, the magazine said that shortly before a supervisory board decision that executive board members had made it clear they were willing to "accept a cut in their bonuses, but not forego them entirely", even though they have repeatedly told the workforce that the crisis threatens the group's very existence.

VW's former chief executive, Martin Winterkorn, received a bonus of more than three million euros ($3.4 million) a year ago. A company spokesman told AFP that the board pay would be published in VW's annual report on April 28.

READ: Experts: Toyota, GM settlements window to Volkswagen saga

'Pure speculation'

"The management board is determined to set an example when it comes to the adjustment in the bonuses," he said, dismissing the Spiegel article as "pure speculation."

Winterkorn's successor, Matthias Mueller, was parachuted in last year to steer the carmaker out of its deepest-ever crisis, which erupted when VW was exposed as having installed emissions-cheating software into 11 million diesel engines worldwide.

At the time, Mueller told the workforce that there would have to be "belt-tightening at all levels" from management down to the workers.

But according to Der Spiegel, the former finance chief Hans-Dieter Poetsch, who was appointed to the head of the supervisory board in October, pocketed nearly 10 million euros as "compensation" for the lower pay he would receive as a result.

The scandal is expected to cost VW still incalculable billions of euros in fines and possible legal costs.

Unions are concerned that the belt-tightening needed to cope with the fallout from the engine-rigging scandal could lead to job cuts.

"We have the impression that the diesel engine scandal could be used as a backdoor for job cuts that weren't up for discussion until a couple of months ago," the works council wrote in a letter to the management of VW's own brand and published on the website of the powerful IG Metall labour union.

'Pact for the future'

The works council called for "an end to speculation regarding the future of the workforce and of the sites at VW" and for a "pact for the future."

VW's labour chief, Karlheinz Blessing, described the works council's letter as "a very good basis for further cooperation.

"We expressly welcome the offer for negotiations on a long-term pact for the future," Blessing continued.

"Guaranteeing production sites is also in management's interests. The talks will proceed quickly and constructively," he added.

Read more on:    vw  |  emissions scandal  |  industry

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