Volkswagen on Tuesday said it had poached Markus Duesmann, head of purchasing and supplier network at rival BMW, to become a member of its management board.
Mr Duesmann is the second high-profile defection to Volkswagen group following the hiring of Herbert Diess in July 2015 as head of the VW brand.
"Mr Duesmann, currently board of management member for purchasing and supplier network at BMW, will take up his new position as soon as he is able to do so," Volkswagen said.
Mr Duesmann is a former head of powertrain development at BMW. Among the German premium car makers, BMW's vehicles have faced fewer regulatory problems tied to excessive emissions when compared with rivals Mercedes and Audi.
BMW on Tuesday said Mr Duesmann had informed its chairman that he would not make himself available for an extension of his contract.
"As a consequence, the chairman of the supervisory board and Mr Duesmann agreed that Mr Duesmann will be relieved of his contractual responsibilities ... with immediate effect," BMW said.
German newspaper Handelsblatt reported that Volkswagen wanted Mr Duesmann to fill the post of Audi chief executive following the arrest of former boss Rupert Stadler.
Mr Duesmann cannot be installed as Audi CEO full time until Mr Stadler permanently steps down as head of the Audi brand. Mr Stadler has only stepped down temporarily while he remains in custody on suspicion of interfering with a probe into the car maker's emissions.