FRANKFURT — Germany’s car industry, already under scrutiny for concealing excess diesel pollution, suffered fresh damage to its reputation on Monday after prosecutors said a top Volkswagen manager was a suspect in a criminal inquiry, and authorities in Berlin ordered Daimler to recall hundreds of thousands of vehicles equipped with illegal emissions-cheating software.

Volkswagen, where the emissions cheating first emerged more than two and a half years ago, was punished for hesitating to overhaul its management ranks when Munich prosecutors said they had opened a fraud investigation into Rupert Stadler, the leader of the carmaker’s highly profitable Audi division and a member of the Volkswagen management board.

Mr. Stadler, whose home was raided by investigators on Monday, is the first active member of Volkswagen’s upper echelon to be identified as a suspect in the inquiry, which has broadened over time to include dozens of current and former managers and engineers.

Later in the day, the German Transport Ministry ordered Daimler to recall 774,000 vehicles in Europe because of “inadmissible” software that shut down or reduced the effectiveness of equipment designed to control diesel emissions.