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Audi CEO's Dieselgate arrest threatens fragile truce among VW stakeholders

FRANKFURT — The arrest and detention of Audi's chief executive forces Volkswagen Group's competing stakeholders to renegotiate the delicate balance of power that has helped keep Audi CEO Rupert Stadler in office. Volkswagen's directors are discussing how to run Audi, its most profitable division, following the arrest of the brand's long-time boss on Monday as part of Germany's investigations into the carmaker's emissions cheating scandal. The supervisory board of Audi, meanwhile, has suspended Stadler and appointed Dutchman Bram Schot as an interim replacement, a source familiar with the matter said on Tuesday. Schot joined the Volkswagen Group in 2011 after having worked as president and CEO of Mercedes-Benz Italia. He has been Audi's board member for sales and marketing since last September. The discussions risk reigniting tensions among VW's controlling Piech and Porsche families, its powerful labor representatives and its home region of Lower Saxony. VW has insisted the development of illegal software, also known as "defeat devices," installed in millions of cars was the work of low-level employees, and that no management board members were involved. U.S. prosecutors have challenged this by indicting VW's former chief executive Martin Winterkorn. Stadler's arrest raises further questions. Audi and VW said on Monday that Stadler was presumed innocent unless proved otherwise. Munich prosecutors detained Stadler to prevent him from obstructing a probe into Audi's emissions cheating, they said on Monday. Stadler is being investigated for suspected fraud and false advertising. Here are the main factors deciding the fate of Audi. Background: Audi's role in Dieselgate Volkswagen Group was plunged into crisis in 2015 after U.S. regulators found Europe's biggest carmaker had equipped cars with software to cheat emissions tests on diesel engines. The technique of using software to detect a pollution test procedure, and to increase the effectiveness of emissions filters to mask pollution levels only during tests, was first developed at Audi. "In designing the defeat device, VW engineers borrowed the original concept of the dual-mode, emissions cycle-beating software from Audi," VW said in its plea agreement with U.S. authorities in January 2017, in which the company agreed to pay a $4.3 billion fine to reach a settlement with U.S. regulators.

Audi bringing Q3 Stateside after all?

One of the major changes that made to the Audi SQ5 to get it ready for the US market was a ride height that was lifted by 1.2 inches compared to its European counterparts. The small increase allowed the SQ5 to retain its "light truck" classification of the Q5 for emissions regulations. In a similar move, Car and Driver is reporting that the Audi Q3 crossover will also be joining the Audi lineup in the US once it receives a facelift and taller ride height.
Expect this facelift to fit in with other recent product updates including the Q5, which mainly focused on a cleaner, more upscale front end and the company's signature LED running lights. The report says that Audi could bring the Q3 Stateside "within a year or two," and it also says that a souped-up RS Q3 will follow close behind. This performance version of the compact crossover gets its power from a 2.5-liter turbocharged inline-five-cylinder engine shared with the Audi TT RS.

Upcoming Audi Q1 rumored to get high-performance SQ1 variant

The Audi Q1 isn't due for another two or three years, yet Auto Bild reports already that it will come in RS and SQ1 trims. According to the report, the RS Q1 will be powered by a 2.0-liter four-cylinder putting out 300 horsepower and 280 pound-feet of torque, putting it about 70 hp and 8 lb-ft beyond the next-most-powerful gasoline engine in the standard range.
Depending on how you like your gumption served, however, the first SQ1 - like its European SQ5 sibling - go the diesel route with a 2.0-liter TDI fitted with twin turbos for 231 hp and 368 pound-feet of torque. That's an improvement of 47 hp and 88 lb-ft over the most powerful diesel engine said to be offered on the regular Q1.
The report goes on to say that there should be g-tron (natural gas) and e-tron versions of the Q1, and buyers will get a deep toy chest of assistance packages to equip it with. Starting price in Europe is expected to be around 25,000 euros, which, if correct, would make it 4,000 euros less dear than the Q3 in Germany.