Volkwagen's board has ousted CEO Mattias Müller, replacing him with VW brand chief Herbert Diess, CNBC confirmed Thursday.
The world's largest automaker is also preparing its truck and bus division for a potential listing.
VW said on Tuesday it was considering replacing Müller. The move is seen as an attempt for the company to make a break with the diesel emission scandals that rocked the company and led to hefty penalties.
Earlier this year, the company suspended a top executive after news broke that the company was involved in tests of the effects of diesel fumes on humans and monkeys. In 2015 , Volkswagen admitted it had used special devices designed to skew results on U.S. emissions tests.
Müller was never charged or directly linked to the scandals, but many thought VW was slow to act as details were made public.
But VW leadership thanked Müller for his service to the company in a statement sent Thursday.
"Matthias Müller has done outstanding work for the Volkswagen Group," VW supervisory board chairman Hans Dieter Pötsch said in the statement. Müller led VW through the "greatest challenge in its history," realigned the German automaker's strategy, and made changes to the company's culture, he added.
"For that, he is due the thanks of the entire Company," he said.
Diess, joined Volkswagen in July 2015, after previously working at BMW.
This story is developing. Please check back for updates.
— CNBC's Phil Lebeau contributed to this story.