By Daniel Hunter
Volkswagen chairman Ferdinand Piech has quit following a power struggle with the company's chief executive Martin Winterkorn.
It comes after Mr Piech criticised his chief executive in an interview with German magazine Der Spiegel.
Mr Winterkorn has been widely tipped as the next Volkswagen chairman, and on 17 April, the car manufacturer's five-member board gave him its backing.
Ferdinand Piech, along with the Porsche family, controls a 51% stake in Volkswagen, which is Europe's biggest car manufacturer.
"The members of the steering committee came to a consensus that, in the light of the past weeks, the mutual trust necessary for successful cooperation was no longer there," the board said a statement.
Mr Piech's deputy, Berthold Huber, takes his place in the interim.
"The uncertainty had to be ended today," said Mr Huber. "The steering committee was and is conscious of its responsibility to Volkswagen and its many thousand staff."
Mr Piech's wife, Ursula, has also resigned from her seat on the board.
Investors reacted well to the news, with share prices rising more than 5%.