July 28, 2017 / 1:29 PM / in 24 days

Audi faces biggest management reshuffle in years: sources

FILE PHOTO: Audi Chief Executive Rupert Stadler presents the new Audi A8 at the Audi Summit in Barcelona, Spain July 11, 2017.Albert Gea/File Photo

MUNICH (Reuters) - Volkswagen's (VOWG_p.DE) embattled brand Audi is facing the biggest reshuffle of its management board in years with four out of seven executives earmarked for dismissal, people familiar with the matter said.

Audi (NSUG.DE), which is the biggest contributor of profits to Volkswagen (VW), is grappling with car recalls, prosecutor investigations and persistent criticism from unions and managers over the emissions scandal and its performance post-dieselgate.

VW now wants top-level changes to prevent the luxury brand being weakened any further, one source said.

"There has to be a clean break," the source said. "It cannot go on like this."

Audi Chief Executive Rupert Stadler has been under fire for over a year for his handling of the fallout from the emissions crisis but the supervisory board extended his contract in May on condition he would not serve a full five-year term.

Instead of ditching Stadler now, Audi's controlling panel is planning to replace finance chief Axel Strotbek, production chief Hubert Waltl, human resources chief Thomas Sigi and sales chief Dietmar Voggenreiter in the near future, three sources told Reuters, adding that successors had not yet been named.

Germany's Manager Magazin reported on the planned reshuffle earlier on Friday, saying VW Chief Executive Matthias Mueller had informed the four executives on Wednesday as part of an Audi board meeting about their imminent dismissal.

VW and Audi declined to comment. Audi's works council, whose members occupy half the seats on the 20 member supervisory board, did not return calls seeking comment.

Audi's labor boss criticized managers this month for lacking a roadmap for production in Germany after key models were assigned to foreign factories while its two main German sites wait to be awarded electric car projects.

Last month, Munich prosecutors widened investigations at Audi after the German government accused the VW division of cheating on emissions tests in its home market.

Reporting by Andreas Cremer and Irene Preisinger; additional reporting by Jan Schwartz and Ilona Wissenbach; editing by David Clarke

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