Volkswagen Group chairman Ferdinand Piech has resigned.

The announcement comes after Piech, 78, lost the backing of Volkswagen’s steering committee after a battle with chief executive Martin Winterkorn.

"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 six-member steering committee said in a statement.

"Against this background, Professor Doctor Ferdinand K Piech resigned from his office as chairman as well as all his supervisory board mandates within the Volkswagen group with immediate effect."

Earlier this month Piech – who along with the Porsche family controls 51% of the VW Group, the second largest car maker in the world – was quoted as saying he had "distanced" himself from CEO Winterkorn, bringing into public a row over the levels of profits within the VW Group and its failure to make inroads in to the American market.

Deputy chairman Berthold Huber will assume interim leadership of the board until the election of a new chairman, Volkswagen said in a statement. Piech's wife, Ursula, has also resigned from the supervisory board.