VW's U.S. chief leaves company, Horn named replacement

By Bernie Woodall

DETROIT, Dec 12 (Reuters) - Volkswagen AG (Other OTC: VLKAF - news) 's U.S. Chief Executive Officer Jonathan Browning has left the company for personal reasons and is to be replaced by 51-year-old Michael Horn, the company announced from its Wolfsburg, Germany headquarters on Thursday.

Browning, 54, a former executive at General Motors Co and Ford Motor Co (NYSE: F - news) , had been with VW since 2010. Volkswagen (Berlin: VOW.BE - news) said on Thursday that Browning will return to Britain, where he is from.

While Volkswagen said that Browning is leaving for personal reasons, several sources with knowledge of the situation said it was his inability to keep VW on pace to meet aggressive U.S. sales targets that caused his departure.

Having been sales executive for GM (NYSE: GM - news) in Europe and managing director of Jaguar when it was owned by Ford left Browning ill-prepared for the inner workings of VW in Wolfsburg, a source said. Browning didn't always have the right telephone numbers for calling company headquarters, the source said.

Meanwhile, Horn, a German national, has spent 23 years at Volkswagen and is seen as the sales architect needed to increase U.S. sales to 800,000 for the VW Group by 2018.

Alec Gutierrez, an analyst with auto industry research firm Kelley Blue Book, said: "Sales are below industry growth, so you have to imagine that's a factor in his dismissal or his leaving the company.

VW's U.S. sales for its namesake brand as well as its Audi (Berlin: NSU.BE - news) luxury brand are up only 1 percent this year while the overall industry is up 8 percent, Gutierrez said.

But Gutierrez added that no one may have been able to increase VW's market share in the United States this year against ever-increasing quality competition, particularly in the small- and mid-sized sedans which are the company's top sellers.

Horn since 2009 has been the head of Volkswagen global after sales, which covers parts and service at VW dealerships. Horn's appointment becomes effective Jan. 1.

Under Browning, U.S. sales of Volkswagen doubled, including an increase of 31 percent in 2012.

But this year, the Volkswagen brand has seen its U.S. sales slip 5 percent while Audi (Xetra: NSU.DE - news) 's sales are up 13 percent through November.

Until Japanese automakers overtook VW in the 1970s, Volkswagen was the top seller of imported cars in the United States.

During Browning's tenure, VW opened a new plant in Chattanooga, Tennessee, where it makes the Passat sedan.

Volkswagen wants to have the Tennessee plant join the rest of its wholly owned plants around the world that have a German-styled works council to represent the workers. Such a council would advise on work rules at the plant and include both blue- and white-collar workers.

In order to set up the German-style labor group at Chattanooga, its workers must be aligned with a U.S. labor union. The company has been in talks with the United Auto Workers.

Browning had said often that if plant workers were to be represented by any union, a vote among workers must be held, a position that has neither been publicly supported nor dismissed by top VW executives in Germany.