Audi must collaborate closely with the Volkswagen Group to deliver a broad realignment of its business after reporting a decline in first-half sales, the premium marque’s finance chief said on Monday as the carmaker faces mounting pressure from weaker markets and rising competition.
Challenges pile up as revenue falls
In its half-year results, the Audi division — which includes Lamborghini, Bentley and Ducati — reported revenue of €29.2 billion for the first six months of 2026, a drop of 10% year on year. Despite that revenue reversal, operating profit increased modestly to €1.1 billion, producing an operating margin of 3.8%, which the company attributed to “strict cost discipline.”
Audi’s finance chief warned that global developments were intensifying the need for structural change across the group. The firm is responding by moving to reduce capacity and tighten its cost base while planning larger-scale adjustments in concert with Volkswagen.
“Global challenges are increasing the pressure to act,” Audi CFO Juergen Rittersberger said. “To remain competitive on the global stage, we must work together with the Volkswagen Group to realign our business model and implement large-scale structural improvements.”
Plants, production and the wider group picture
One immediate operational flashpoint is Audi’s Neckarsulm plant in south-west Germany. The facility is named among four German Volkswagen plants that face the prospect of closure after 2030 as the group seeks to cut costs and respond to intensifying competition, particularly from Chinese manufacturers, and tariff pressures.
Management says Audi has already begun to pare back capacity at Neckarsulm: the plant now runs at an annual production capacity of 225,000, which is stated to be about 75,000 fewer than in previous years. The workforce and supplier implications of such reductions will be a focus for local and national policymakers as the group seeks to rebalance its footprint.
Numbers at a glance
| Metric | First half 2026 | Year-on-year change |
|---|---|---|
| Revenue | €29.2 billion | -10% |
| Operating profit | €1.1 billion | +3% |
| Operating margin | 3.8% | — |
| Neckarsulm annual capacity | 225,000 units | ≈75,000 fewer than prior years |
Implications and near-term priorities
For Audi and the wider Volkswagen Group, the immediate task is to reconcile falling top-line sales in key markets with the fixed costs of high-volume manufacturing and premium product development. The company highlighted weaker demand in China and the United States as drivers of the decline in sales for the period.
Management’s emphasis on working with the group suggests forthcoming centralised measures to reduce costs, optimise capacity and sharpen product strategies across marques. That approach will be watched closely by investors for signs of deeper consolidation, by suppliers for demand visibility, and by governments and unions for the local employment consequences of plant rationalisations.
- Pressure from China: intensifying competition from Chinese automakers is a key strategic challenge.
- Market weakness: demand downturns in China and the US hit sales volumes.
- Cost focus: improved margin driven by tight cost controls, despite lower revenue.
The balance Audi strikes between trimming capacity, protecting premium positioning and investing in future technologies will determine whether it can sustain margins and market share as the automotive sector adapts to new competitive dynamics.
Reporting by Rachel More and Christina Amann for Reuters; editing noted in the company statement.
