Audi reports drop in profit during 2023

German carmaker Audi increased sales and turnover last year, but made significantly less profit, the company announced on Tuesday during its annual press conference.

Profit after tax fell by 12% to just under €6.3 billion ($6.8 billion). This was mainly due to the effects of raw material hedging transactions, chief financial executive Jürgen Rittersberger said.

The outlook for the current year is bleak: Audi expects sales to fall from €69.9 billion to €63 to €68 billion, partly due to several model launches after two years without a new model.

"2024 will be an even more challenging year than 2023 - 2024 will be a year of transition for Audi," said Rittersberger. Competition will become tougher and discounts will have to be granted in some areas, he said. Investments will increase.

The model changeover and launch of the Audi Q6 e-tron, the A6 e-tron and the A5 will lead to higher costs and have a temporary negative impact on sales, he added. Audi is also experiencing supply problems with engines.

Chief executive Gernot Döllner is basically sticking to the dates for phasing out the combustion engine, but wants to keep a degree of flexibility open with regard to customer wishes.

The future of the car is electric, Audi will present its last new combustion model in 2026 and is aiming to phase out the combustion engine in 2033, Döllner said.

However, he also pointed out that the EU would review its ban on new combustion engines planned for 2035 in 2026.

By the end of the decade, Audi should sell just as many e-cars as combustion engines and therefore be just as profitable, said Döllner. Currently, only 10% of the 1.9 million Audis sold are fully electric.

Just before the annual press conference, Audi presented the Q6 e-tron electric SUV, the first Audi vehicle based on the PPE platform developed jointly with Porsche for luxury cars.

Audi currently offers three all-electric model series on three different platforms. The launch of the Q6 e-tron was delayed by two years due to software problems.

The first fully electric car from the main plant in Ingolstadt has a range of up to 670 kilometres, will be launched in Germany and the US in the second half of 2024 and will also be built in China next year.

Last year, Audi increased its sales by 17% to 1.9 million cars and turnover by 13% to €69.9 billion. The operating result before special items fell by 18% to €6.3 billion.

The sales margin in the core business fell to 10%; in the current year it is expected to be between 8% and 10% with lower sales.

Audi employs 53,000 people in Germany.