In January, 2019, Audi just recently faced its first sales dip in a long time, with deliveries down three percent. Not a huge dip but a dip nevertheless. It still sold 144,650 cars worldwide, so Audi is still doing alright. But no one can deny the fact that Audi’s sales have dipped a bit and it’s most due to Europe’s Worldwide Harmonized Light Vehicles Test Procedure (WLTP), which is extremely strict on emissions. Apparently, the issues Audi ran into with the WLTP had to do with the high number of engines it sells in various different models. So the brand is looking to cut back.
“We have discontinued engines and variants built specifically for a few markets,” Audi CEO Bram Schot told German newspaper Handelsblatt. “Overall, we have reduced complexity by around 30 percent. We can no longer afford models and equipment that are bought by customers infrequently.”
So with fewer engine options, Audi is cutting costs which will then keep profit margins similar sales go down. The first engines to go will be the large V8 and W12 engines in its higher-end cars. Not only are they expensive and sell in too few numbers, they’re inefficient and hurt the brand’s new green image.
Audi is also looking to cut back in other areas. For instance, it’s removing about 10 percent of its management and executive positions while also stopping the night shift at the Ingolstadt, Germany plant.
CEO Bram Schot also wants to create a bit of a new environment at Audi. He wants the brand to become more progressive, more forward thinking than before. According to his interview with Handelsblatt, he wants a “more open, more feminine and younger” brand.
In total, the four-ringed brand wants to save around €15 billion (about$17 billion) by 2022. That’s still a few years away but it seems as if Audi is already cleaning house.