Audi’s third-quarter earnings have risen sharply, mainly because last year, the burden of shutting down its Brussels plant weighed heavily on the results. However, the positive figures mask deeper financial strain from tariffs, falling volumes in China, and rising costs associated with its transition to electric vehicles.
Audi reported an operating profit of €468 million for the third quarter (+341%), up from just €106 million a year earlier, when heavy restructuring charges related to the closure of its Brussels plant hit its income.
The improvement, however, offers little comfort for Audi’s near-term future. Its operating margin, for example, dropped to 3.2 percent in the first nine months from 4.5 percent a year ago. It’s a writing on the wall.
Hit harder than rivals
Chief Financial Officer Jürgen Rittersberger said tariffs and restructuring costs are eroding the margins. He confirmed that US import duties alone will cost the company about €1.3 billion this year.
With no local manufacturing base in the United States, Audi will be hit harder than BMW or Mercedes, which both can rely on local assembly operations. Volkswagen’s luxury brand is reviewing whether to build a plant in the US, with a decision possibly coming before year-end.
Rittersberger also added that the brand is “tightening cost control” and simplifying product complexity to strengthen profitability as it advances its electrification strategy. “The situation remains very challenging”, he added.
The shutdown of Audi Brussels earlier this year—once the production hub for the Q8 e-tron—helped lower structural costs but also underscored the brand’s ongoing operational reshaping. The factory closure, affecting about 3,000 workers, marked one of the largest automotive restructurings in recent years in the EU.
Electric growth in all major markets
Looking at sales, the company delivered nearly 1.2 million vehicles across its Audi, Bentley, Lamborghini, and Ducati brands. Deliveries of its battery-electric models jumped 41 percent to 163,000 units, driven by strong sales of the Q6 e-tron. Yet total group deliveries slipped nearly 5 percent as supply bottlenecks dampened volumes.
China remained Audi’s weakest region. Deliveries there fell 9 percent as domestic brands intensified price competition. To counter declining sales, Audi has launched its subbrand, Audi for the area, with a strong reception for its first model, the E5 Sportback.
However, these numbers will start materializing in the following quarter. In Europe, sales declined modestly, while North America posted a 5 percent decline amid higher tariffs that inflated prices.
The above-mentioned uptake of electric models accelerated across all significant markets, with sales in Germany rising by as much as 70 percent and in North America by more than 50 percent.
Group net cash flow dropped to €2.1 billion, down from €3.8 billion last year, partly due to Audi’s purchase of the remaining shares in Sauber, the future base of its Formula 1 entry.
