From the rubble and the shadows of post-World War II Germany came the rise of an auto giant we now know as Volkswagen (VLKAF) .
Throughout its history, the automaker has developed a sizable but notable portfolio of models regarded as icons amongst its loyal fanbase.
From timeless icons like the Beetle and the Type 2 ‘Bus’ that have earned generational love and praise to modern-day bestsellers like the Golf hatchback and Jetta sedan, Vee-Dub is not just a car manufacturer to its cult base of enthusiasts — it is a lifestyle.
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However, hordes of loyal fans worldwide can only do so much to uphold the brand they love ever so dearly. Recently, Volkswagen has been trying to adjust to the rest of the automotive industry, as it adopts electrified and electric vehicles to adhere to tighter emissions regulations in major markets like Europe and North America.
While VW executives promise U.S.-bound hybrid vehicles, Volkswagen is struggling to save itself from a hole it created in its lean towards electric vehicles, and its struggles may have cost a key executive his job.
VW Group of America President & CEO Pablo Di Si poses with a picture with comedian Gabriel Iglesias at the Volkswagen ID. Buzz (U.S. version) Global Reveal on June 02, 2023, in Huntington Beach, California.
Goodbye, Di Si, hello Gruner
After just two years serving in his current capacity, VW of America announced on November 19 that its now-former CEO, Pablo Di Si, has officially left the company.
In its statement, Volkswagen noted that Di Si “stepped down from his position at his own request” without disclosing further details about the circumstances. However, it mentions that it is “indebted” to his service.
“Volkswagen AG is indebted to his predecessor, Pablo Di Si,” VW AG Group Human Resources Board Member Gunnar Kilian said. “His outstanding commitment was of central importance in realigning our business in South America. He subsequently laid the foundation for the positive development of our North American strategy.”
The former CEO’s departure follows reports by German news outlets Der Spiegel and Manager Magazin and Automotive News earlier this month that the embattled executive was already on his way out at the automaker.
After making his mark in South America, Di Si took the CEO role after now-Scout Motors CEO Scott Keogh left his post in 2022. However, Di Si came after publications noted that he was being blamed for CEO-level missteps that predate his C-suite tenure. Specifically, Volkswagen was not impressed with the automaker’s performance in the United States, which was tied to poor EV sales.
In its report, Der Spiegel noted that Di Si wanted to use the gradual shift to EVs to boost VW’s press in the U.S.
The automaker was already raking in profits due to the semiconductor shortage during the pandemic, but Di Si’s miscalculations led to a sour relationship with Volkswagens in Germany. VW is on the hook for an “all-in” bet on #Vs that Di Si bet VW’s house money on.
“You get such a job when you make big promises,” an unnamed company executive told Der Spiegel. “And you lose it again because you are unable to fulfill them.”
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Di Si’s replSi’sent comes from a familiar name
In the same statement that announced Di Si’s departure, Volkswagen named his replacement: a former Porsche executive named Kjell Gruner, who will officially take the helm on December 12. In the meantime, VW Chief HR Officer Gerrit Spengler will assume the role.
Kjell Gruner, Rivian Chief Commercial Officer
MediaNews Group/Orange County Register via Getty Images/Getty Images
Gruner’s time in the auto industry is commendable. He held several leadership positions at both established brands and hungry upstarts. His prior positions are a LinkedIn-savvy professional’s dream with former employers including the Boston Consulting Group, VW Group nameplate Porsche, Daimler-Chrysler, and Mercedes-Benz.
Before being named the new VW of America CEO, he was the Chief Commercial Officer (COO) at Rivian (RIVN) , which should present an excellent opportunity for VW of America’s joint venture with the EV upstart.
“Kjell Gruner is an absolute expert for the U.S. market,” Kilian said. “He has over 25 years of experience in the automotive industry and extensive know-how in exploiting and expediting growth opportunities in North America.”
A Volkswagen Tiguan (l) and a Volkswagen ID.7 are lifted out of boxes during a photo shoot in one of the two car towers at Volkswagen Autostadt in Wolfsburg, Germany
picture alliance/Getty Images
Gruner inherits a bad situation and a valuable opportunity
Gruner is coming in at a time when VW’s problems exist all over the planet. In the United States, VW is negotiating a contract with the United Auto Workers at its Chattanooga factory; however, it is also facing scrutiny as it weighs decisions that will severely impact its relationship with labor unions in Germany.
According to a report by Autoblog, VW is set to close three of its German factories in a cost-cutting move to save the company more than $4.3 billion. Additionally, it is struggling to sell its cars in one of its biggest markets: China.
However, VW bigwigs are confident in Gruner’s Gruner’s. In a statement, Volkswagen Group CFO and COO Arno Antlitz noted that he was an “experienced expert” who knows the pulse of American auto buyers.
“The North American market with Canada, Mexico, and the USA is an important strategic pillar for the Volkswagen Group,” Antilit said. “With Kjell Gruner, we brought on board an experienced manager who knows the market and customers extremely well and will continue to consistently pursue the growth path we have embarked on.”
Related: VW’s plans to sell its cool, new EVs might land itself into trouble
Volkswagen has more tricks up its sleeve. Recently, it launched Scout, a new EV brand piggybacking on a familiar, nostalgic name for many loyal car enthusiasts.
The brand’s SUV and Terra pickup are cool, off-road-oriented EVs that will also come in range-extended variants dubbed the “Harvest,” which uses a gas engine generator to boost its range from 350 electric miles to 500 miles.
In addition, Volkswagen and Rivian finalized their joint venture deal on November 12. The $5.8 billion commitment will fund “next-generation electrical architecture and best-in-class software technology” for electric vehicles from both brands.
“The launch of the joint venture demonstrates the potential we want to leverage together in the coming years,” VW GroupCEO Oliver Blume said in a statement. “We have a clear plan to offer our customers the best products and digital experiences at attractive prices through state-of-the-art development processes, innovative technological approaches, and a competitive cost base driven by synergies.”
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