Rupert Stadler, chief executive officer of Audi AG, looks on as he unveils the Audi AG A8 sedan automobile during a launch event in Barcelona, Spain, on Tuesday, July 11, 2017. Stadler faces his toughest test since taking the helm at Audi ten years ago, as Volkswagen’s biggest profit contributor grapples with declining sales and widening legal probes into its role in the diesel scandal. Photographer: Pau Barrena/Bloomberg
INTERNATIONAL - Audi CEO Rupert Stadler was arrested in Munich today in connection with the diesel-cheating scandal, making him the highest-profile target in the probe that’s engulfed the carmaker and parent Volkswagen for almost three years.

Munich prosecutors investigating Audi’s role in the 2015 scandal confirmed they arrested Stadler, 55, in the Bavarian capital because of risk he may tamper with evidence, according to an emailed statement Monday.

The decision throws into doubt the manager’s future at the helm of Volkswagen’s most important earnings contributor. Pressure on Stadler has steadily built over the past few months, including a raid at his home last week. Until now, backing of the Porsche and Piech families, who control the world’s biggest carmaker, ensured him continuing in the role he’s held since 2007. Volkswagen’s supervisory board is meeting today, where Stadler’s future will be among the topics of discussion.

‘‘I don’t think VW can afford to leave Stadler in the position,” Juergen Pieper, a Frankfurt-based analyst at Metzler Bank, said by phone. “It’s actually a mystery to me that they left him in place for so long.”

Even if he wasn’t directly involved in the diesel-engine manipulation, there has been an obvious lack of oversight at Audi that stretched over years, Pieper said.



“What is really disappointing as well is that 2.5 years after the diesel cheating came to light the brand continues to face scrutiny over software used in current models,” he said.

Multiple Probes
Prosecutors in Munich, Stuttgart and Braunschweig are continuing their investigations of the carmaker and its units. In April, Stuttgart authorities arrested a senior engine manager at the company’s luxury Porsche brand, after conducted raids at 10 sites as part of a long-running probe. Wolfgang Hatz, a former VW manager who joined Audi unit in 2001 and from 2007 to 2011 ran VW’s motor development, remains in custody in Munich.

Volkswagen declined 2.2 percent to 157.88 euros and traded 2 percent lower at 11:50 a.m. in local trading, extending losses this year to 5.2 percent.

Nearly three years on from the scandal, VW faces a multitude of probes both in Germany and abroad, with legal proceedings in 55 countries pending and investigations into stock-market manipulation in its home market. The company has earmarked more than 27 billion euros ($31 billion) in fines, buybacks and costs. Investors have accused the company of informing investors too late about the probe, a view the carmaker has contested.

Just last week, Volkswagen agreed to pay a 1 billion-euro fine imposed by German prosecutors for cheating to get around diesel-emissions regulations.

- BLOOMBERG