Volkswagen plans change of command in software branch – 05/09/2023 – Market

Volkswagen is planning a revamp at the top of its struggling software arm, which has been plagued by delays and budgetary errors.

Cariad, the German software arm created in 2020, has faced problems that have led to delays in launching new models. One of the priorities of VW’s new chief executive, Oliver Blume, has been defining Cariad’s software strategy, which is becoming increasingly important in the age of internet-connected cars.

Cariad’s supervisory board will propose Peter Bosch, a VW veteran who joined Bentley in 2017, as the unit’s new boss, according to two people familiar with the talks. The current head of the software arm, Dirk Hilgenberg, as well as chief technology officer Lynn Longo and chief financial officer Thomas Sedran are seeking new roles at the VW group, the people said.

Bosch, who is credited with successfully turning around the once-losing Bentley, has no software experience but will be supported by two additional “software specialists” to be hired in the coming months.

“Cariad still needs to work with traditional automakers like Volkswagen, Porsche and Audi and needs to speak their language,” said one person.

Cariad was launched under former VW boss Herbert Diess, and the unit’s growing problems were a major factor in his departure last year.

It was created by the merger of around 1,500 software developers from VW, Porsche and Audi, and since then the unit has hired over 4,000 people, with branches established in the United States and China.

Last week, VW reported strong first-quarter sales figures in Europe and the United States, but revealed that car deliveries had fallen further in China, its most important market.

The software has emerged as a key pressure point for VW in China, whose local brands have quickly taken the lead in terms of in-car entertainment and other aspects of the interaction between drivers and their cars.

The only member of Cariad’s executive team who has been invited to remain is Rainer Zugehör. According to a source, the unit’s rapid growth during Covid was the only aspect of it that was successful.

One person said that “it wouldn’t be the first time” that VW executives who have failed in their roles are moved to a different position within the group. “It’s normal at Volkswagen,” the person said.

Translated by Luiz Roberto Gonçalves