Audi reports significant profit decline amid weak China market
German carmaker Audi has reported a stark decline in profits for the third quarter of the year, primarily due to challenges in the Chinese market and rising competition. The Volkswagen subsidiary announced a net income of 95 million euros, marking an 87 percent drop from 718 million euros in the same period last year.
Audi's Chief Financial Officer Jürgen Rittersberger highlighted the challenges in China, citing a weakened combustion engine market as a significant factor contributing to the company's financial struggles. In addition, increasing competition and export pressure from Chinese manufacturers targeting the European market have further strained Audi's performance.
The automaker also pointed to ongoing global uncertainties, including geopolitical tensions in the Middle East and rising energy costs, as well as U.S. tariffs. These factors have collectively impacted Audi's financial outlook, forcing the company to revise its annual forecast downward.
For the first nine months of 2023, Audi reported earnings of 1.2 billion euros and revenue of 42 billion euros. Both figures represent a notable decline, prompting Audi to reduce its projected sales return to between three and five percent with expected revenues between 55 and 59 billion euros for the year.
"The figures clearly demonstrate the urgent need for action at Audi," Rittersberger said. He acknowledged the heightened competitive pressure in recent months and emphasized the importance of cost discipline, reducing complexity, and enhancing operational efficiency as part of Audi's response to the challenges.
Despite the concerning profit figures, Audi remains optimistic about a potential recovery in the final quarter of the year. The introduction of new SUV models, including the Q7 and Q9, is expected to bolster performance, especially in the U.S. market.
Rittersberger expressed hope for a rebound, stating, "We anticipate a significantly stronger fourth quarter." This positive outlook is tied to Audi's strategic measures and new vehicle launches, which aim to drive market momentum and improve financial results.
Source: tagesschau.de