FRANKFURT (Reuters) - Volkswagen's (VOWG_p.DE) powerful labour chief Bernd Osterloh told German newspaper Handelsblatt that a dispute with embattled VW brand chief Herbert Diess over how to implement reforms at the carmaker's core brand, has been laid to rest.
A truce between Diess and Osterloh would mark an end to months of infighting at the world's biggest carmaker, which is struggling to regain its footing after a damaging diesel emissions cheating scandal.
In recent months talks with management over how to implement a turnaround plan were broken off by the company's labour leaders, who control nine out of 20 seats on VW Group's board of directors, leaving in limbo a deal on cost-cutting.
"There was a fundamental dispute between works council and the brand chief. That's history," Osterloh told the paper. "All participants now have the goal to enter calmer waters."
Osterloh said the company's core brand could implement a 3.7 billion euros ($4 billion) savings programme by working together with Diess, in what amounts to a marked change of tone for the labour chief.
"Herbert Diess is a good technician who has mastered purchasing, development and production. I have always said we have a lot in common and analyse many topics in a similar manner. Now we have consensus that we want to do this together, management, IG Metall and the works council," Osterloh said.
VW already has around 2,000 fewer staff than at the beginning of 2015, in line with a staff attrition plan, Osterloh said. In addition to VW overhaul plans agreed upon in November 2016, there are ideas to hike efficiency by a further 10 million euros, he said.
And by implementing VW's current turnaround proposals VW has saved 40 million euros more than planned, he told the paper.
Osterloh further said he continued to see Volkswagen's supervisory board backing Audi Chief Executive Rupert Stadler even after prosecutors stepped up an investigation of the premium brand's role in a diesel cheating scandal.
(Reporting by Edward Taylor)