Herbert Diess has taken charge of the Volkswagen Group as its new CEO, and will also continue to serve as Volkswagen's brand chief.

In this role, Muller will replace Herbert Diess, who was Chairman of the Volkswagen brand. Mueller, who formerly headed Porsche, took over as CEO unexpectedly in September 2015 when Martin Winterkorn resigned over the company's scandal over cars rigged to cheat on emissions tests.

While Mueller brought VW's share price and profits back up to pre-crisis levels, observers say he made little progress in shaking up the firm's famously hierarchical and insular corporate culture, which some critics believe discouraged employees from speaking up about the diesel scam.

Some analysts cheered the appointment of Mr Diess.

"Matthias Muller has laid the groundwork for our transformation", Diess said in the release.

Sanford Bernstein analyst Max Warburton said Diess' track record of cost-cutting points to a more efficient VW under his leadership.

Porsche Chief Executive Oliver Blume is going to join the management board of VW Group, one of the sources stated.

As part of the reorganization, the Volkswagen Group has announced that Audi CEO Rupert Stadler will head Group Sales, while Porsche CEO has been appointed to the Group Board of Management and will oversee the Group production.

"The new VW boss Diess has a long to-do list", Greens party parliamentary leader Anton Hofreiter told Germany news agency DPA.

Volkswagen Group's new structure will now be composed of six divisions, as well as a specialist China-focused group.

"The Volkswagen Group's goal is and remains to align the company and its brands with future needs, to safeguard its position among the leaders of the worldwide automotive industry with innovativeness and profitability and to be instrumental in shaping tomorrow's personal mobility with the strength of our Group brands", said chairman of the Supervisory Board Hans Dieter Pötsch in the statement announcing the changes. Poetsch said that, whatever moves the company makes with the truck operation, Volkswagen won't cede control of the division. Europe's largest automotive group is poised to replace group chief executive Matthias Mueller this week with Diess, a cost-cutter hired in 2015 from BMW as it seeks fresh impetus for its recovery from an emissions scandal.

VW additionally reported that works board official Gunnar Kilian would supplant Karlheinz Blessing as HR boss.

His cost-cutting measures and other changes are seen at top levels to have been essential to the record earnings the auto group posted a year ago. Additionally, Porsche sports vehicle division head Oliver Blume is being promoted to the top management body of the entire group.