The recent Volkswagen emissions scandal has left many wondering about the future of CFO Hans Dieter Potsch. Potsch is catching a lot of attention surrounding the scandal, as it is up to him to calculate Volkswagen’s losses. Millions of cars were involved in the scandal, and the company faces financial fines and legal claims.
Potsch Takes On the Task of Calculating Losses
Potsch will need to determine how much money it will cost to fix the affected cars and settle legal claims. He will also have to identify how much will be covered in liability insurance. At the moment, the company is facing billions of dollars in liabilities. Volkswagen estimates that roughly 11 million diesel engine cars contain software that allowed the company to circumvent emissions regulations. The company has already lost $7.3 billion in charges covering the cost of the scandal, dropping its share price significantly. Chief executive Martin Winterkorn recently resigned because of the scandal.
Being Volkswagen’s risk officer, Potsch’s main duty is to assess the financial damage the scandal is expected to create. In addition to managing day-to-day finances, Potsch must also reassure bankers and investors of the company’s solidity. While the company has already stated that roughly 11 million cars were involved, the extent of the issue still isn’t completely clear. It comes as no surprise then that the process is expected to be long-term and expensive. Volkswagen is already facing $18 billion in fines from the U.S. alone.
What the Scandal Means for Potsch’s Career
Despite the problems, Potsch is still in line to become company chairman. Volkswagen confirmed Potsch’s candidacy in a meeting in late September. A shareholder meeting, originally scheduled for November 9th, has been cancelled in the wake of the scandal. Volkswagen is seeking court approval to appoint Potsch as chairman. German law allows companies to request court-approved supervisory meetings in situations like these. If Potsch steps up as chairman, his CFO position will be filled by Frank Whitter, chairman of the Financial Services department. Though many are weary of Potsch’s ability to continue in a leadership role, Volkswagen officials state they are supportive.
The company has until October 7th to identify and correct technical repairs to the emissions software. It has also halted sales of several models that were involved in the scandal