The supervisory boards of Volkswagen AG and Audi AG said they have reached an agreement with Audi CEO Rupert Stadler to terminate his employment, effective immediately. Stadler, who began working for Audi in 1990, had been chairman of the firm since 2007 and has served on the Volkswagen board since 2010. He was suspended by both firms following his arrest in June in connection with the dieselgate emissions scandal.

A statement from Volkswagen AG said: “Mr Stadler is leaving the companies with immediate effect and will no longer work for the Volkswagen Group. Mr Stadler is doing so because, due to his ongoing pre-trial detention, he is unable to fulfil his duties as a member of the board of management and wishes to concentrate on his defence. The contractual execution depends on the course and outcome of the criminal proceedings.”

Stadler remains in prison after an appeal to be released was rejected by the Munich court in August. In a statement, the court said: "The chamber emphasises that danger of obstructing justice remains. The release of the accused from custody was therefore rejected.”

Stadler is one of the many Volkswagen Group executives giving evidence in a Stuttgart court case between September and November.

Mooted replacement
Stadler will be replaced by former director of purchasing at BMW, Markus Duesmann.

According to Automobilwoche, Duesmann will take the helm from January 1, 2019, taking over from interim CEO and sales and marketing boss Abraham Schot. Audi, however, has not commented on the matter. Announcing Duesmann's appointment last week, the group said in a statement: "Mr Duesmann, currently board of management member for purchasing and supplier network at BMW, will take up his new position as soon as he is able to do so. An agreement to this effect has already been signed."

Reaction to arrest

The arrest of Stadler earlier this year following an investigation on charges of fraud and misrepresentation as part of the fieselgate emissions scandal came as a "massive shock" to Volkswagen Group boss Herbert Diess, who described his colleague as a "problem solver".

Diess told German newspaper Bild am Sonntag: "The arrest of a CEO of a major car brand – that's never happened before."

Following this, Audi temporarily placed Schot at the helm. But a source, speaking to Automotive News Europe, said that Stadler was not expected to return to the company, regardless of the outcome. Since his arrest, he had been placed on leave by Audi.

Reasons for arrest

Stadler’s detention came after German police and members of the Munich public prosecutor's office raided his private residence in Germany. German media reports suggested evidence obtained in the recent questioning of other former Audi officials link Stadler to possible diesel emissions manipulation from 2012 onwards.

The Munich public prosecutor's office cited "evidence suppression" as the reason for the arrest. Stadler, however, has continuously denied any wrongdoing relating to the dieselgate scandal