BERLIN (Reuters) - Audi NSUG.DE Chairman Matthias Mueller appealed to workers to ignore a media report that Chief Executive Rupert Stadler was about to be ousted, hoping to quell further unrest at the scandal-hit Volkswagen group.

FILE PHOTO: Rupert Stadler, CEO and Chairman of the Board of Management of Audi, attends the "AI for Good" Global Summit at the International Telecommunication Union (ITU) in Geneva, Switzerland June 7, 2017. REUTERS/Denis Balibouse

German tabloid Bild reported on its front page on Friday that Stadler would leave in April because of his handling of the diesel emissions affair, in which Audi played a prominent role. The report said Stadler would however be given a new role as VW group finance chief.

In a message to Audi staff, Mueller, who is also CEO of parent company Volkswagen, said the luxury carmaker needed the full concentration of management and workers to overcome its current challenges under Stadler’s “proven leadership”.

“Please pay no attention to the personnel speculation spread by the media, which lacks any foundation,” Mueller said in the message sent to Reuters by email.

Volkswagen has repeatedly attempted to draw a line under a scandal that broke out in 2015 when it admitted cheating diesel-emission tests in the United States to conceal the amount of noxious gases emitted by some of its vehicles.

Under Mueller, who took over when Martin Winterkorn quit days after the scandal broke, the leading German carmaker has settled the main U.S. legal case to result from the cheating and sought to turn the page with an electric-vehicle initiative.

But the “Dieselgate” crisis refuses to die, reigniting conflicts between the powerful family, management, trade union and political interests who vie for the upper hand in the group.

On Thursday, Volkswagen’s top labor representative said the company’s drive to improve accountability, seen by investors as a major plank in VW’s ability to regain trust, had made zero progress.

MIRED IN SCANDAL

Sources have said that Mueller is growing frustrated by a lack of support for his reform efforts and by the lingering scandal. VW Chairman Hans Dieter Poetsch said on Monday there was no reason to question Mueller’s position.

The revelation last month that German carmakers including Volkswagen had commissioned tests in which monkeys were exposed to toxic diesel fumes were a stark reminder that VW had not yet put its past behind it.

And last week, Audi’s headquarters were searched by German prosecutors widening their inquiry into the manipulation of diesel-emissions tests.

Stadler ran finance at Audi for four years before becoming CEO in 2007. He was a confidant of, and former assistant to, then-VW chairman Ferdinand Piech, the scion of Volkswagen’s controlling clan who was himself ousted in 2015.

His position as CEO has been questioned before but so far Audi’s board has rallied around him.

Bild said Stadler would be moved to take charge of VW group’s finance portfolio, currently run by Frank Witter, a former head of the carmaker’s financial services division. Witter is well regarded among investors and uncontroversial with VW’s powerful unions, a source close to VW said.

Sources close to Audi said there had been no discussion on the supervisory board about replacing Stadler. The controlling panels at Audi and parent VW are due to hold separate regular meetings next week.

Porsche SE PSHG_p.DE, the group through which the billionaire Porsche and Piech families control their majority stake in VW, declined comment.

POSSIBLE SUCCESSORS

A senior source close to VW told Reuters last week that Stadler retained the backing of the Porsche-Piech clan.

Bild said that ex-Skoda chief Winfried Vahland - who quit the VW group weeks after the scandal broke out in 2015, declining to take up his post as North America chief - was favorite to succeed Stadler.

Should Vahland refuse the job, BMW BMWG.DE development chief Klaus Froehlich was a possible alternative, it said.

But BMW said Froehlich was not a candidate to replace Stadler.

Reuters could not immediately reach Vahland, who has kept a low profile after quitting Volkswagen.

Audi, VW’s main profit contributor, did not admit to using illicit emissions control devices in the United States until November 2015, two months after the scandal at parent VW was revealed.

Audi developed the bigger 3.0 liter V6 diesel engines used in about 80,000 VW, Audi and Porsche models that in 2015 were found to be equipped with illicit software and to exceed U.S. emissions limits.