Audi – The German car maker cut its sales predictions for the year last Friday. Volatile currency markets were blamed, with predictions that its revenue will slow compared to 2015, a result of “challenging” conditions.
The negative forecast by the ‘Volkswagen umbrella’ company’s management has followed hot on the heels of a scaling back in its profitability predictions.
Audi said that they now expect the company’s total revenue for 2016 to be more likely level with last year’s £52.49 billion, instead of the moderate increase it had originally predicted.
In the UK, Audi’s second European market, the weakening of Sterling has been the cause of many contributing problems. Volatile foreign exchange rates have also contributed to the poorer sales outlook, a company spokesman commented, without going into details.
“The conditions our company faces are currently very challenging,” Chief Executive Rupert Stadler said.
Audi’s 9-month operating profit, adjusted for certain items, dropped by 25% to 3.03 billion Euros compared to the year-earlier period. Its operating margin decreased to 6.9%, far below Audi’s 8-10% target range.
The company, based in Ingolstadt, said last Thursday that its profitability benchmark would drop “considerably” beneath the 8-10% target this year after announcing 620 million Euros was to be allocated for new risk provisions projects.
Money has also been set aside for consequences of the diesel emissions scandal, which has caused a moderate impact on Audi’s resources.