Volkswagen chief executive Winterkorn resigns

Volkswagen (VW) Chief Executive Martin Winterkorn has resigned, just days after admitting that the world’s top-selling carmaker had rigged diesel emissions to pass US tests during his tenure.

No replacement was put forward following Wednesday’s announcement, and VW still has no easy exit from a scandal that has suddenly dented a reputation for trustworthiness that took decades to build.

The smog-test trickery has wiped out billions in VW’s market value and raised the specter of criminal investigations and billions more in fines.

Winterkorn took responsibility for the “irregularities” found by US inspectors in VW’s diesel engines, but insisted he had personally done nothing wrong.

“I am doing this in the interests of the company even though I am not aware of any wrongdoing on my part,” his statement said.

“Volkswagen needs a fresh start … I am clearing the way for this fresh start with my resignation.”

Winterkorn, 68, resigned following a crisis meeting of the Volkswagen supervisory board’s executive committee.

Its acting chairman, Berthold Huber, said company directors are “resolved to embark with determination on a credible new beginning”.

Huber said a successor will be discussed at a board meeting on Friday that was originally intended to approve extending Winterkorn’s contract through to 2018.

‘Defeat device’

VW reversed some of its market slide on Wednesday, closing up 6.9 percent at 118.90 euros, but the company’s share price has a long way to go to recoup this week’s losses.

Nearly $28bn was wiped out in the first two days of trading after the US Environmental Protection Agency (EPA) revealed on Friday that VW has been violating the Clean Air Act and could be subject to fines of as much as $18bn.

Winterkorn, VW’s boss since 2007, had come under intense pressure since the EPA’s disclosure that stealth software makes VW’s 2009-2015 model cars powered by two-litre diesel engines run cleaner during emissions tests than in actual driving.

The EPA accused VW of installing the so-called “defeat device” in 482,000 cars sold in the US.

VW later acknowledged that similar software exists in 11 million diesel cars worldwide and was setting aside 6.5 billion euros to cover the costs of the scandal.

Huber said “Mr Winterkorn had no knowledge of the manipulation of emission values,” and praised the departing CEO’s “readiness to take responsibility in this difficult situation for Volkswagen”.

Stephan Weil, the governor of Lower Saxony state, which holds a 20 percent stake in Volkswagen, said VW is filing a criminal complaint, “because we have the impression that criminally relevant actions may have played a role here.”

Weil, also a VW director, promised to “clear up these events with all the possibilities we have inside the company and ensure that those involved are punished severely”.

The prosecutors’ office in Braunschweig, near VW’s Wolfsburg headquarters, confirmed that it is weighing an investigation of VW employees.

Other governments from Europe to South Korea have begun their own inquiries, and law firms have already filed class-action suits on behalf of customers.