VW star faces espionage charges

German prosecutors are expected to charge Volkswagen executive Jose Ignacio Lopez with industrial espionage later this month, a lawyer acting for the car chief confirmed yesterday.

Mr Lopez has been under investigation since 1993 after he quit as head of purchasing at General Motors to join Volkswagen, taking with him, General Motors alleges, commercial secrets about new production techniques.

The charges, to be laid by the Darmstadt prosecutors office, relate to allegations that Mr Lopez and three other former General Motors executives took with them secrets relating to a new manufacturing concept known as Plant X.

During the three-year campaign General Motors has waged against Mr Lopez and Volkswagen, it has alleged that the information was used to help build a new production plant in Brazil. Volkswagen has consistently denied the allegations.

In a statement issued from his Frankfurt office, Mr Lopez's lawyer, Jurgen Taschke, said he expected charges to be filed against his client in November. The three other executives who are expected to be charged - Jose Gutierrez, Jorge Alvarez and Roscario Piazza - left General Motor's German subsidiary, Opel, at the same time as Mr Lopez left to join Volkswagen in March 1993. General Motors initiated criminal proceedings against its former executive two months later.

Volkswagen said that Mr Lopez, a member of its management board, would remain with the company even if he were to face criminal charges.

Mr Lopez has been credited with helping return Volkswagen, Europe's biggest car-maker, to financial health after falling into losses in the early 1990s. As head of General Motor's worldwide purchasing operations, he has a fearsome reputation for cost-cutting. He brought his skills to Volkswagen, helping it to streamline production, improve working practices and return to profitability.

A spokesman for the Frankfurt prosecutors office, which is handling public statements concerning the case, refused to comment on the statement from Mr Lopez's lawyer.

"We are not commenting on whether a decision has already been taken to bring charges or to terminate proceedings," Hildegard Becker-Toussaint, the office's spokeswoman, said.

She said a decision would be made by the end of the year on whether criminal charges were to be brought against Mr Lopez and the three other executives.

German newspaper reports had earlier quoted Mr Lopez's lawyer as saying he expected the four would be charged with misappropriation and unfair competition.

If found guilty, Mr Lopez could face a maximum prison sentence of five years.