Martin Winterkorn shares in €63m pay pot for current and former Volkswagen board members despite presiding over defeat devices affair

This article is more than 4 years old

This article is more than 4 years old

The Volkswagen boss who resigned over the German carmaker’s diesel emissions scandal is to walk away with €16.6m (£13m) before tax.

The German automotive company said 12 current and former board members will share €63m in pay for 2015, even after agreeing to a voluntary reduction in their salaries.

Their pay deals include performance-related bonuses worth €35m for 2015, a year in which the company set aside €16.2bn to cover the cost of the emissions affair.

Martin Winterkorn, the chief executive who resigned after it emerged that 11m of its cars were fitted with defeat devices to manipulate emissions data, was also handed a termination payment worth €9.3m.

The golden goodbye came on top of a €7.3m salary package for 2015, of which €5.9m relates to his performance for the year in which the scandal broke and led VW to a €4.1bn loss.

Volkswagen has faced criticism in Germany for handing out any bonuses at all, a decision described as a “slap in the face” by Herbert Behrens, regional head of the leftwing party Die Linke in the carmaker’s home state of Lower Saxony.



Speaking at VW’s annual investor conference, Winterkorn’s replacement, Matthias Müller, said he had apologised personally for the emissions scandal to Barack Obama, during the US president’s state visit to Germany.



“We know that we have disappointed many people — people who have placed their trust in Volkswagen,” he said. “We stand by our responsibility. And we are doing everything in our power to regain trust.”

He added that VW would make a big push into electric cars, with 20 new models to be unveiled by 2020.

The company has negotiated a compensation deal in the US, under which drivers will be offered money for the impact on the value of their vehicle. But Müller said no such deal would be forthcoming in Europe, where looser requirements on diesel emissions mean less work needs to be done on affected vehicles.

Dr Hans-Christoph Hirt, co-head of Hermes EOS – the stewardship arm of fund manager Hermes Investment Management – said: “There are some very serious questions under investigations, also with regard to the role of the management board.

“In these circumstances, the management board should not accept any bonus at all for 2015.

“They should wait for the outcome of the investigation. In the absence of them voluntarily coming to that conclusion, the supervisory board chairman should have resolved it behind the scenes.

“They should have recognised that shareholders have lost a lot of money and employees face losing their jobs. It shows the lack of sensitivity that exists in Volkswagen.”

VW has set aside €16.2bn to cover the cost of the scandal and said on Thursday it expects about €8bn of this to be spent on buying back diesel cars.

The group admitted in its annual report that its costs could rise still further, potentially forcing it to sell assets.

It also released fresh financial data detailing the recent impact of the scandal on the VW brand, by far its largest by revenue. The marque swung from a €780m profit in the fourth quarter of last year to a €127m loss, compared with strong profits at its other brands, Audi, Porsche and Skoda.

The group said it was withholding data on sales so far in 2016 on the advice of its lawyers.

A report into the scandal by the law firm Jones Day was scheduled to be published this month, but has been delayed.

VW said the investigation had so far gathered more than 100 terabytes of data. It has collected 1,500 external storage devices, such as USB sticks, from 380 employees, some of whom have been dismissed.

The company said the data had helped “trace the origin and and the development of the diesel issue to a large extent”. It believes the problem began with VW’s efforts to grow in the US, where emissions restrictions on diesel cars are particularly strict.

A “group of persons – whose identity is still being determined” had responded to this by modifying engine management software, VW said. Members of the board of management had no knowledge of this, the company insisted.