By Jan Schwartz and Nick Carey
HAMBURG (Reuters) -The head of Volkswagen (DE:)’s powerful works council will take a management position at the carmaker’s truck unit Traton, removing a prominent opponent of faster and more drastic restructuring at the German carmaker.
Traton said on Friday that Bernd Osterloh, who has been a member of the supervisory board at Volkswagen since 2005, will take up the position of personnel director on May 1.
Last year, the 64-year-old Osterloh clashed with Volkswagen Chief Executive Officer Herbert Diess, opposing an attempt to extend Diess’ contract as he strives to cut costs and free up resources to invest more in electric vehicles.
“Volkswagen CEO Herbert Diess’ most outspoken opponent is sidelined and it’s fair to say that it creates the opportunity to run VW in a more rational fashion,” Bernstein analyst Arndt Ellinghorst wrote in a client note.
Reuters first reported on Thursday that Volkswagen was considering a supervisory board change that could lead to Osterloh’s departure.
“With Bernd Osterloh on the Executive Board team, we will tackle the tasks ahead,” Traton Chief Executive Officer Matthias Gründler said in a statement.
“His extensive experience in a globally positioned organization will have a positive impact on cooperation among our brands and partnerships.”
In a statement Volkswagen CEO Diess said Osterloh had “constructively questioned the management and has thus helped time and again to find solutions that were in the company’s best interests.”
Osterloh will step down from all his roles at Volkswagen and will be replaced by deputy works council head Daniela Cavallo as soon as possible, Volkswagen’s labour representatives said in a statement. She will also take over Osterloh’s functions on Volkswagen’s supervisory board, an appointment that requires shareholder approval.
Under Germany’s system of corporate governance labour representatives make up half Volkswagen’s board.
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