Audi expects sales to let it match 2011 profit

VOLKSWAGEN’s Audi brand stuck to its goal to hold profit steady this year as higher deliveries in China and the US offset slowing demand in Europe, Audi said yesterday.

“Provided the economic framework does not deteriorate further, we expect operating profit to remain on a par with 2011,” chief financial officer Axel Strotbek said. Audi last year posted $6.57bn in earnings before interest and taxes.

The VW unit, which overtook Daimler’s Mercedes-Benz in sales last year to become the world’s second-largest luxury car brand, yesterday reiterated a forecast that deliveries this year will rise to more than 1.4-million vehicles from 1.3million last year.

Audi said the new A1 Sportback, Q3 sport-utility vehicle and the A3 compact, which reaches dealerships this year, will help the luxury-car maker reach its sales goal.

Operating profit for the Ingol- stadt, Germany-based company rose 13% to $3.54bn in the first half, VW said last week. Sales climbed 16% to $30.70bn.

Audi is expanding as it looks to overtake Bayerische Motoren Werke (BMW) in luxury car sales. The VW unit plans to start producing cars in Mexico by 2016, marking its first plant in North America. Earlier this month, the maker of the TT coupe completed the purchase of Italian motorcycle maker Ducati to compete with BMW in two-wheelers.

Audi posted a profit margin of 11.5% of sales in the second quarter, beating Mercedes’ 8.6%. BMW, which will report earnings for the period today, probably generated a profit margin of 11.5%, according to analyst estimates compiled by Bloomberg.

Sales at Audi jumped 12% to 733,250 vehicles in the first half. Deliveries of BMW’s namesake brand rose 8.3% to 747,064 cars and sport-utility vehicles.

Mercedes sales rose 6.9% to 652,924 cars. Bloomberg