The board is expecting an update at the last supervisory board meeting before the summer break, one of the people said, adding no date has been set yet.
"What the board has presented is not enough," said the other person.
Volkswagen declined to comment.
Volkswagen has called its software division, which is the central element in its autonomous driving push, "the most ambitious project of our entire industry to tap into the most relevant profit pools of the future".
Cariad plans to challenge existing software incumbents, including Apple and Tesla, but has hit bumps in the road, which could become a problem for VW boss Herbert Diess, who is responsible for the unit on the group's management board.
Spiegel first reported the news, not citing where it obtained the information, adding that the problems at Cariad, which have caused delays to product launches at Europe's top carmaker, had been discussed at a supervisory board meeting on May 11.
Software has been a sore spot for Europe's largest carmaker ever since the use of illegal defeat devices resulted in the "dieselgate" scandal at Volkswagen in 2015, the largest such case to date.
(Reporting by Jan Schwartz; Writing by Christoph Steitz; Editing by Louise Heavens)