VW's Blunt U.S. CEO Peels Out With Nary A Word

In what is said to be a “mutual agreement,” Volkswagen Group of America CEO Michael Horn is leaving the company “effective immediately,” a development that seems to have taken many analysts — as well as the automakers’ U.S. dealer council — by surprise. 

Hinrich Woebcken, who is presently head of the North America region and chairman of Volkswagen Group of America, will replace him on an interim basis.

Horn’s departure … “comes as Volkswagen-brand car sales have plummeted in the U.S. and the Justice Department and German prosecutors are probing the automaker,” write John D. Stoll and Mike Spector for the Wall Street Journal. “The 54-year-old executive was well-liked by Volkswagen dealers for his frankness and has been the embattled company’s chief spokesman in the U.S. as it worked to regain trust with car buyers and dealers.”



Horn declined comment when Automotive News’ Ryan Beene got hold of him late yesterday.

U.S. dealers have “long complained about the lack of support they received from the company’s managers in Germany,” Jad Mouawad reports in the New York Times, and the emissions scandal that erupted in September “further tested the relationship.”

Horn had improved dealer relations so much in his 15 months at the top “that when the years of cheating came to light…,” point out Bloomberg’s Jamie Butters and Keith Naughton, “independent retailers lobbied for him to remain on the job and said his removal would be “catastrophic.” 

“People know this scandal was rooted in Germany, which is why this is so surprising,” Kelley Blue Book senior analyst Rebecca Lindland, tells Butters and Naughton. “In terms of scapegoats, there are other goats out there ….” 

Horn joined VW in 1990 out of school and held a variety of management positions here and in Europe before succeeding Jonathan Browning as the U.S. CEO effective Jan. 1, 2014.

Woebcken is an industrial engineer with extensive international experience in procurement, production and sales, according to a company bio issued when he was appointed chairman in January. Volkswagen brand CEO Herbert Diess seemed to go out of his way to state, at the time, that Horn’s “function … remains unchanged.”

Horn was known for being blunt and forthright. 

“Let's be clear about this: our company was dishonest — with the EPA and the California Air Resources Board — and with all of you. And in my German words: ‘We totally screwed up. We must fix those cars,’ Horn said in New York on Sept. 21,” writes Automotive News’ Beene.

“Horn has at times appeared frustrated with the German company’s handling of the crisis,” writesThe Guardian’s Rupert Neate. “When he was called before the U.S. Congress in October, he denied any prior knowledge of the software [installed to cheat on regulator’s tests], and said its installation was not a corporate decision. ‘I agree it’s very hard to believe,’ he told lawmakers. ‘Personally, I struggle, too.’”

The National Volkswagen Dealer Advisory Council issued a statement calling Horn’s departure “a serious blow to the U.S. dealer network, the employees of Volkswagen of America, the workers at the Volkswagen plant in Chattanooga, and the entire Volkswagen community.” 

Jalopnik’s Michael Ballaban reprints the full text of the dealer’s letter, which “goes into detail about why Horn was so supported, and why the VW NDAC (not-so-subtly) is mad at VW corporate executives right now.”

Alan Brown, GM of Hendrick Volkswagen in Frisco, Texas, and the advisory council’s president, spoke to numerous media outlets expounding on those sentiments, telling Reuters’ David Shepardson he’s flying to Germany for several days of meetings with VW executives.

“Brown said it was important VW stick with the business plan it approved to expand U.S. sales by quickly refreshing and redesigning vehicles,” Shepardson writes. “U.S. VW dealers ‘don't want a handout. They want a chance to win,’ Brown said. He said VW should scrap the idea of positioning itself as a ‘near premium brand’ and return to its roots in the 1960s of selling mass-market vehicles like the iconic Beetle.”

Autotrader.com analyst Michelle Krebs tellsFinancial Times’ Robert Wright that Volkswagen seems to be trying to start fresh. “But still what is lacking is a clear plan for helping owners of these vehicles and a plan forward for the brand,” she said.

“What could he have done, besides give cars away?” industry consultant Maryann Keller tells Bloomberg. “This is not fixable by any one person in the United States. This has to be fixed by someone in Germany.”

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