VW’s former CEO to remain on payroll one more year

#hashtags: #Volkswagen #Martin Winterkorn #December 2016 #Reuters #Winterkorn #December 31

Volkswagen’s former chief executive Martin Winterkorn will be paid by the company until his contract expires in December 2016, sources revealed to Reuters.

Martin Winterkorn stepped down as CEO of Volkswagen in September and drew a lot of criticism at that time as he didn’t immediately resign after the first disclosures in the emissions scandal occurred. Company’s supervisory board agreed that Winterkorn will remain on the payroll until his contract expires on December 31, 2016, the sources said, confirming a report by Germany’s Handelsblatt newspaper and public broadcaster ZDF. The reason behind such a questionable decision is the automaker’s attempt to limit the financial consequences of an immediate contract termination, that would attract considerable compensations and disburse millions of euros in severance payments that would eclipse the former chief executive’s salary.

During almost nine years as chief executive officer, Winterkorn amassed a pension pot of 28.6 million euros (around 31 million dollars) and last year he was the highest-paid CEO among the heads of companies listed on Germany’s DAX-30 blue-chip index, with remuneration of about 16 million euros (over 17 million dollars). A spokesman at Wolfsburg-based VW declined to comment on matters related to contracts and Winterkorn could not be reached for comments through his law firm. After he stepped down, Volkswagen named Porsche chief Matthias Muller as its next chief executive. Analysts have said that the emissions test crisis could cost Europe’s biggest carmaker as much as 35 billion euros in regulatory fines, lawsuits and vehicle refits.

Via Reuters