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Audi aims to increase profit margins this year and will introduce new models.
Investing.com – The luxury brand division of Volkswagen Group (including Audi, Lamborghini, Bentley, and Ducati motorcycles) expects an operating return of 6% to 8% this year, up from 5.1% last year, the company said Tuesday.
With Audi planning to launch new models including the Q9 SUV and implementing efficiency measures to address U.S. tariffs and competition in the Chinese market, profit margins are expected to improve.
Last year, Audi’s operating return fell to 3.9%, partly due to tariffs and costs related to adjusting its electric vehicle plans. CFO Jürgen Rittersberger said at a media briefing on Tuesday that Audi aims to achieve double-digit returns by 2030.
The luxury brand group faced €1.2 billion ($1.4 billion) in U.S. tariffs and provisions for CO2 regulation compliance last year. The company is also advancing plans to cut 7,500 jobs at its German factories by 2029.
Audi is launching several new models to boost sales. In Europe, the compact electric vehicle A2 e-tron will target the growing demand for electric cars. The full-size Q9 SUV is designed for the U.S. market, where sales declined last year due to a lack of large SUVs in the company’s product lineup.
In China, Audi’s deliveries are declining as BYD and Xiaomi gain market share with advanced electric vehicle technology and lower prices, though last year’s decline has slowed to 5%. At the Beijing Auto Show next month, Audi will showcase the second model of its China-exclusive sub-brand developed in partnership with SAIC Motor—the AUDI E7X SUV.
Parent company Volkswagen is working to improve the performance of its luxury brands Audi and Porsche. These brands have traditionally generated substantial returns for Europe’s largest automaker, but profits have declined due to high costs of electric vehicle strategy adjustments, U.S. tariffs, and declining sales in the Chinese market.
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