Volkswagen underscored its efforts to slash costs and lift profits when it appointed Wolfgang Bernhard, a restructuring expert and former top manager at DaimlerChrysler, to its management board.
VW said Mr Bernhard - once tipped to succeed Jürgen Schrempp as chief executive of DaimlerChrysler - would join its board in February.
The 44-year-old, regarded as a tough negotiator, would initially help with the "unbundling process of brand and group responsibilities", said Bernd Pischetsrieder, VW chief executive. However, by January 2006 "at the latest", Mr Bernhard would head the Volkswagen brand division, which includes Skoda, Bentley and Bugatti cars.
The announcement comes as Europe's biggest car-maker engages in a second round of heated wage talks with unions this week. VW's calls for a two-year wage freeze put it at odds with union demands for a 4 per cent wage increase and extensive job guarantees.
The appointment also follows DaimlerChrysler's surprise withdrawal earlier this year of a job offer for Mr Bernhard to head its Mercedes Car division, one of the most coveted jobs in the motor industry.
Industry insiders say Mr Bernhard, known for his sometimes abrasive management style as chief operating officer at Chrysler, clashed with both unions and management at the US unit.
However, they said Klaus Volkert, head of the VW workers' council and a supervisory board member, is understood to have held talks with the main UAW labour union in the US, which nevertheless "gave Mr Bernhard a nod of approval". But one London-based analyst added: "A management change is not enough to alter the gravity of the overall problems facing VW." He cited the weak outlook for sales in Asia, rising losses in the US, weak domestic demand and VW's high material costs relative to its rivals.
Mr Bernhard's appointment came as VW issued a further jobs warning in the wage round, saying it would consider putting up to 5,000 new jobs under the wing of a separate unit should the unions block a wage compromise.