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Volkswagen just hired the German auto sector’s Mr Fixit

Watching Developments At Volkswagen AG's Headquarters As New Chief Executive Officer Expected To Be NamedWatching Developments At Volkswagen AG's Headquarters As New Chief Executive Officer Expected To Be Named
Matthias Müller is bringing in some outside help.Photograph by Krisztian Bocsi — Bloomberg via Getty Images

Volkswagen AG (VLKAY) has hired the German auto industry’s Mr. Fixit to plot a way out of the smoking, choking hole it has dug itself into.

The German giant said Monday Thomas Sedran will take over as group head of strategy on November 1. His last job was at General Motors Corp. (GM), where he had responsibility in Europe for the Chevrolet and Cadillac brands. He had previously been interim CEO of Opel, GM’s long-running headache in Europe.

Sedran is best known for being one of the foremost management consultants in the auto industry in Europe, having led the global auto practice at German consulting firm Roland Berger, then at Alix Partners.

The appointment is conspicuous in as much as Sedran is not a company insider. After the resignation of chief executive Martin Winterkorn last month, VW had turned to a company veteran, Porsche head Matthias Mueller, to take over the helm, while also speeding up the promotion of Hans Dieter Poetsch, the long-serving chief financial officer, to chair the company’s supervisory board.

The company had been criticized at the time for making hires that appeared to be designed to protect the previous generation of managers, a team that presided over the diesel emissions scandal.

However, in the last couple of weeks, VW has hired law firm Jones Day to lead an external investigation into the scandal, and brought in a former judge from Germany’s top court, Christine Hohmann-Dennhardt, to head its legal and compliance division.

The appointment of Sedran comes on the day that VW lost the top spot as the world’s biggest automaker by sales to Japanese rival Toyota Motor (TOYOF). VW had better news over the weekend, when it was able to confirm that its most modern generation of diesel engines, the EA288, doesn’t run the so-called ‘defeat devices’ that are at the heart of the scandal.

Defeat devices allow the car to recognize when it is being run in test mode, and switch to a mode of running that consumes less fuel and puts out fewer emissions. However, in real-world conditions, the engine returns to a higher-performance mode that puts out up to 40 times the legal limit of harmful nitrogen oxides, as well as consuming far more fuel.