VW Dealers Say Ousting U.S. Chief Would Be `Catastrophic'

  • Retailers' group says Michael Horn repaired their trust
  • Dealer council reacts to reports that he may be replaced

Volkswagen AG’s U.S. dealer council vowed “unconditional support” for Michael Horn, head of the automaker’s operations in the market, saying his removal would be “catastrophic.”

Horn has been mentioned as one of the executives who might lose his job, after Chief Executive Officer Martin Winterkorn resigned Wednesday in the wake of the German automaker’s admission that it rigged U.S. emissions tests. The admission caused VW to pull cars from dealer lots.

“We have been suffering from an outdated product cycle, overpriced product and a deteriorating relationship between the dealer body and Volkswagen for a number of years,” VW’s National Dealer Advisory Council said in a statement Thursday. “That all changed when Michael Horn was made CEO of Volkswagen of North America in January of 2014.”

U.S. regulators said last week that VW admitted to outfitting almost half a million diesel Volkswagen and Audi vehicles with software that turns on full pollution controls only during official tests. The fallout so far has trimmed about 20 billion euros ($22.4 billion) of the company’s market capitalization and opened it to criminal investigations. Winfried Vahland, who runs the company’s Skoda division, will likely take over for Horn, Auto Bild magazine reported, citing unidentified people at the carmaker.

“Unless there is evidence being withheld from us showing some form of direct complicity or creation of this issue we must state that if he is removed as the CEO it would be nothing short of catastrophic to our market and our relationship,” the council said.

Volkswagen has 652 dealers in the U.S., according to the group.

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