Volkswagen is allegedly feeling the heat from some investors about the power wielded by unions in the decision-making process.

Volkswagen is denying the company it has come under pressure from one of its largest shareholders to curb the influence of its powerful trade unions – but the report underscores the challenge the troubled automaker is facing as it tries to trim spending to cover the costs it faces in the wake of its ongoing emissions scandal.

The German weekly newspaper, Bild am Sonntag, reported that the Qatar Investment Authority, or QIA, was putting pressure on VW CEO Matthias Mueller to reduce the power of the works council, which has a near-veto role on the maker’s Supervisory Board. And the council has been resisting calls for even bigger spending cuts than those recently announced by CEO Mueller.

The maker is trimming about $1.1 billion, or 8%, off its capital budget. It has also set aside more than $7 billion to cover costs related to the scandal, and lined up a one-year, $21 billion bridge loan. But with some estimating the ultimate price tag could reach as much as $50 billion, some analysts believe further cuts, and the possible sale of some corporate assets, may be needed.

Call for cuts have not gone down well with the union, and that makes it difficult for members of management looking to respond to the diesel emissions crisis. The works council, made up of members of the powerful union IG Metall, holds as many seats on the Supervisory Board as do shareholders – including QIA.

(Diesel scam could lead to partial break up of VW empire. For more, Click Here.)

The Qataris are the third largest of Volkswagen’s investors, with a 17% stake in the automaker. The investment group holds just two seats on the supervisory board, which has a significant say in key corporate decisions, including the ability to both hire and fire top managers.

QIA officials met with senior VW managers on Sunday, the Bild reporting they would demand steps to reduce the union’s power. But a company spokesman later told the Reuters news service that subject was “not on the agenda of the talks.”

Mueller is expected to post interim results of an internal investigation into the diesel scandal on Dec. 10. The maker also faces a number of external probes, including one by the U.S. Justice Department and two by German prosecutors.

(For more on Volkswagen’s planned spending cuts, Click Here.)

Separately, the carmakers could face more than $18 billion in fines by the U.S. Environmental Protection Agency, which set off the brouhaha when in September it accused the maker of cheating on emissions tests involving 482 vehicles sold in the U.S. using a 2.0-liter diesel.

VW then admitted the so-called “defeat device” was installed on 11 million vehicles sold worldwide. It later acknowledged to the EPA it also cheated on tests involving a 3.0-liter diesel used on VW, Audi and Porsche products.

Along with the potential penalties and possible criminal fines, the carmaker is facing more than 350 lawsuits in the U.S. alone. A multi-district judicial panel met last week to determine whether, where and how to consolidate those suits.

The scandal has already led to a sharp slump in VW sales. But the long-term potential could be significantly worse. To line up a $21 billion bridge loan from a consortium of European banks, VW reportedly had to pledge that it would sell off assets to ensure repayment, if necessary.

(Reality setting for Volkswagen sales and it’s not looking very good. For more, Click Here.)

Even if VW doesn’t move to curb the direct role of its unions in corporate management, CEO Mueller is looking to make some major changes. He has set out a goal of decentralizing the company, moving more power to its brands and divisions. Under Mueller’s two immediate predecessors, Martin Winterkorn and Ferdinand Piech, the maker operated as a highly centralized organization – a factor many observers believe may have contributed to the diesel issue.