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Audi CEO Arrested Over Diesel Scandal

Audi CEO Arrested Over Diesel ScandalAudi CEO Arrested Over Diesel Scandal

Audi CEO Rupert Stadler was arrested in Munich on Monday in connection with the diesel-cheating scandal, making him the highest-profile target in the probe that has engulfed the carmaker and parent Volkswagen for almost three years.

Munich prosecutors investigating Audi’s role in the 2015 scandal confirmed they arrested Stadler, 55, in the Bavarian capital because of risk he may tamper with evidence, according to an emailed statement Monday, Bloomberg reported.

The decision throws into doubt the manager’s future at the helm of Volkswagen’s most important earnings contributor. Pressure on Stadler has steadily built over the past few months, including a raid at his home last week. Until now, backing of the Porsche and Piech families, who control the world’s biggest carmaker, ensured him continuing in the role he has held since 2007. Volkswagen’s supervisory board is meeting today, where Stadler’s future will be among the topics of discussion.

“I don’t think VW can afford to leave Stadler in the position,” Juergen Pieper, a Frankfurt-based analyst at Metzler Bank, said by phone. “It’s actually a mystery to me that they left him in place for so long.”

Even if he was not directly involved in the diesel-engine manipulation, there has been an obvious lack of oversight at Audi that stretched over years, Pieper said.

 “What is really disappointing as well is that 2.5 years after the diesel cheating came to light the brand continues to face scrutiny over software used in current models,” he said.

Prosecutors in Munich, Stuttgart and Braunschweig are continuing their investigations of the carmaker and its units. In April, Stuttgart authorities arrested a senior engine manager at the company’s luxury Porsche brand, after conducted raids at 10 sites as part of a long-running probe. Wolfgang Hatz, a former VW manager who joined Audi unit in 2001 and from 2007 to 2011 ran VW’s motor development, remains in custody in Munich.

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