The Audi Group has demonstrated resilience in the first half of 2024, stabilizing its financial performance despite facing significant market challenges.
According to CFO of Audi Group Struggles In1st Half Of 2024 Jurgen Rittersberger, the company’s efforts to improve efficiency and explore new revenue potentials are paying off, although a challenging road still lies ahead. With the launch of several new models, including the new Audi A5 family and the upcoming Audi A6 e-tron, Audi is showcasing its capability to deliver and adapt in a dynamic market environment.
Financial Highlights of Audi Group
Revenue: €30.9 billion
Operating Profit: €2.0 billion
Net Cash Flow: €1.1 billion
Vehicles Delivered: 843,991
Electric Vehicles Delivered: 76,657 (+1.3%)
Performance Program 14: Enhancing Efficiency
Audi’s Performance Program 14 is a cornerstone of the company’s strategy to navigate current challenges. The program focuses on enhancing operational efficiency and maximizing cost and revenue opportunities. This initiative is crucial as Audi aims to maintain financial stability and support the introduction of new models that cater to evolving consumer demands.
New Models of Audi Group Leading the Charge
CEO Gernot Dollner highlighted the significance of the new Audi A5 family as the harbinger of the next generation of combustion engines. Following closely is the Audi A6 e-tron, set to debut at the end of July, and the new Q5, expected in the fall. These models exemplify Audi’s commitment to innovation and sustainability, reflecting the brand’s strategic pivot towards electric and hybrid vehicles.
Revenue and Profit Margins of Audi Group
Audi reported a revenue of €30.9 billion for the first half of the year, a 9.5 percent decline from the previous year’s strong figures. The operating profit stood at €2.0 billion, with an operating margin of 6.4 percent. These figures underline the economic pressures faced by the company, yet they also highlight Audi’s ability to sustain profitability through strategic initiatives and cost management.
Delivery Trends: BEV Growth Amid Market Challenges
In the first half of 2024, the Audi Group Progressive delivered 843,991 vehicles across its Audi, Bentley, and Lamborghini brands, marking an 8.2 percent decline from the previous year. Notably, deliveries of all-electric models increased by 1.3 percent to 76,657 vehicles. The demand for plug-in hybrids also surged by approximately 61 percent year-on-year, indicating a positive shift towards sustainable vehicle options.
Regional Performance
Europe
In Europe, Audi’s all-electric models maintained stable demand despite changes in subsidy programs. With 48,332 electric cars delivered, this represented only a slight decrease of 1.7 percent from the previous year. Overall, Audi delivered 343,575 vehicles in Europe, a 9.7 percent decline, with Germany showing a significant drop to 102,511 vehicles delivered.
United States
The demand for Audi’s electric models continues to rise in the United States, with a 10.2 percent increase in electric vehicle deliveries, totaling 11,121. However, overall vehicle deliveries in the U.S. were down by 14.2 percent to 92,913 units.
China
In China, Audi maintained robust performance with 320,370 vehicles delivered, a slight decline of 1.9 percent amidst a challenging market environment. This stability underscores Audi’s strong brand presence and consumer loyalty in the region.
Financial Stability and Sustainability
Despite the challenges, Audi Group’s financial performance remained resilient. The company’s net cash flow was €1.1 billion, a decrease of 39.9 percent from the previous year, primarily due to lower results. Audi also improved its ESG rating, achieving a B- rating from ISS ESG, placing it among the highest-rated companies in the automotive sector. This improvement is driven by the expansion of Audi’s electrified fleet, aligning financial success with sustainability goals.
Performance of Bentley, Lamborghini, and Ducati
As part of the Brand Group Progressive, Bentley, Lamborghini, and Ducati contributed positively to Audi’s overall performance. Bentley delivered 5,476 vehicles, Lamborghini increased its deliveries by 4.1 percent to 5,558 models, and Ducati delivered 32,098 motorcycles. Despite some declines in revenue and operating profit for Bentley and Ducati, Lamborghini showed robust growth in revenue and maintained a strong operating margin.
Outlook for 2024
Looking ahead, the Audi Group expects revenue to range between €63 billion and €68 billion for the full year 2024. The operating margin forecast has been adjusted to between 6 to 8 percent, considering expected restructuring expenses. The net cash flow forecast remains unchanged at €2.5 to 3.5 billion, indicating continued financial stability.
Conclusion
The first half of 2024 has been a period of adaptation and resilience for the Audi Group. With strategic initiatives like Performance Program 14 and the launch of innovative new models, Audi is well-positioned to navigate the challenges ahead. The company’s focus on efficiency, sustainability, and market responsiveness underscores its commitment to delivering value to customers and stakeholders alike.
As Audi continues to innovate and expand its portfolio, the brand’s ability to stabilize earnings amidst a volatile market demonstrates its strength and strategic vision. With a robust plan in place and a promising lineup of new models, Audi is poised to drive forward in the second half of the year and beyond.