Martin Winterkorn Could Receive $67 Million Severance Package

Martin Winterkorn, who resigned as Volkswagen CEO on September 23 at the height of the emissions scandal, could receive a huge sum in pension and severance payments.

He could receive compensation of up to €60 million ($67 million), depending on how the company calculates his severance.

Martin Winterkorn resigned days after VW admitted to systematically manipulating emissions tests on its diesel-powered cars. Up to 11 million cars could have been affected by the scandal.

According to the automaker’s annual report, there are two sources of compensation for Martin Winterkorn upon his departure, as well as perks such as the use of a company car, as long as he is collecting a pension.

By the end of 2014, Martin Winterkorn had amassed a pension worth €28.6 million.

VW report also describes a severance payout rule that gives a departing member of the management board the equivalent of a maximum of two years of his total remuneration.

In 2014, Martin Winterkorn’s severance entitlement totaled €15 million – a combination of a fixed salary of €1.5 million and various benefits and incentives, according to VW’s 2014 annual report.

The exact terms of Martin Winterkorn’s exit package may vary and depend on how the supervisory board characterizes his departure.

According to the rules outlined in VW’s annual report, a management board member who leaves before the end of his contract is only eligible to receive the 2-year severance payout if they leave through no fault of their own. How the VW supervisory board interprets that phrasing remains unclear.

Meanwhile, German prosecutors have started a probe against Martin Winterkorn who will be investigated over “allegations of fraud in the sale of cars with manipulated emissions data”.