BUSINESS
09/25/2015 08:07 am ET Updated Sep 25, 2015

Volkswagen Names New CEO Amid Wave Of Firings

Porsche chief Matthias Müller is the new man in charge.
Alexander Koerner via Getty Images

Volkswagen named Matthias Müller its new chief executive on Friday as it reshuffles its ranks in the wake of a calamitous pollution scandal.

"My most urgent task is to win back trust for the Volkswagen Group -- by leaving no stone unturned and with maximum transparency, as well as drawing the right conclusions from the current situation," Müller, 62, said in a statement. "Under my leadership, Volkswagen will do everything it can to develop and implement the most stringent compliance and governance standards in our industry."

He previously headed the company's Porsche sports car division

U.S. CEO Michael Horn, who was expected to lose his job, will remain. The heads of research and development at Volkswagen's Porsche and Audi luxury divisions may be axed, according to Reuters.

Volkswagen did not immediately respond to The Huffington Post's request for comment on Friday about the potential firings.

The moves come two days after CEO Martin Winterkorn resigned from the world's biggest carmaker, acknowledging that the company had installed software on some 11 million diesel vehicles to circumvent emissions tests.

The company planned to publicize the results of an internal investigation to determine who had knowingly programmed some diesel cars to detect when they were receiving emissions tests and then fudge the real emissions numbers, Reuters reported. The vehicles went back to emitting nitrogen oxide at 40 times the legal limit when the tests were over.

Nitrogen oxide leads to smog, which is connected to asthma and other respiratory illnesses.

The wave of firings may not be enough to stem Volkswagen's bleeding.

Norway's economic crimes unit reportedly opened an investigation into the company on Friday.

The company's stock price was still down by nearly a third from last Friday, despite meager gains of about 1 percent after Winterkorn's resignation on Thursday. Shares remained volatile on Friday morning.

Worse, the company's reputation is in shambles. Volkswagen's brand perception fell into negative territory for the first time in six years as more people heard about the scandal, according to data from YouGov's BrandIndex, which tracks consumers' views of companies.

YouGov BrandIndex

That negative perception could end up costing the company more than the approximately $7 billion set aside to deal with the scandal's fallout. Volkswagen surpassed Toyota in July as the world’s largest automaker by sales -- but this scandal is clearly going to cost them customers. 

The potential losses have stoked fears in Germany, where the company is a major employer and manufacturer.

"Without VW, this city and the entire region would die," Karsten Raabe, a taxi driver in Wolfsburg, Germany, where the company is headquartered, told Bloomberg. "We'd become a European Detroit."

This story has been updated with statements from Volkswagen.

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