Audi expects EVs to match combustion profits in “two to three years”

Lionel Kong
Audi e-tron family in Singapore

A new “Vorsprung 2030” corporate plan spells out Audi’s plan to stay viable after dropping new combustion cars in 2026

INGOLSTADT, GERMANY — Audi can see a path to profit for its electric cars, and expects them to deliver the same margins as its combustion cars within three years. Chief financial officer Jürgen Rittersberger made the claim yesterday as the Ingolstadt-based carmaker unveiled Vorsprung 2030, its new corporate strategy.

The plan, translated as Progress 2030, replaces the “consistently Audi” corporate roadmap from just two years ago. The company reiterated a recent announcement that its new models from 2026 will be all-electric. It will start to phase out combustion engines then and expects to build its last fossil fuel car in 2033.

Chief strategist Silja Pieh (below) said global upheaval forced Audi to rethink its strategy. “We all know that the world is changing ever faster and we need to adapt to that,” she said.

She and a team of 500 Audi employees at various seniority levels and from major markets spent months looking at 600 trends to figure out what would be relevant over the next decade.

“Sustainability is growing in importance for our customers, but also individual mobility is very important for our customers, and that means for a new strategy for Audi,” she said.

“Also, we have changes in the regulatory framework. The new Green Deal in Europe, but also the new Biden administration, they’ve put a focus on climate protection. These are all aspects that we’ve now put into a new strategic alignment, and that was a reason for us to say, ‘Right, we’re going to have to change our strategy.’”

Audi says Vorsprung 2030 puts emphasis on profitable growth, but it also requires the company to hit the gas on its ESG (environment, society and governance) efforts. Chief executive Markus Duesmann said the plan will ensure that Audi “remains viable”.

At its core, that means making money on cars, which in turn means making the “right” product decisions and working on the profitability of each vehicle, according to CFO Mr Rittersberger (below).

Jürgen Rittersberger, Member of the Board of Management of Audi, Finance and Legal Affairs

“Here, we are on the right track, but with electric vehicles, we still have a bit of work to do,” he said. “The profitability of the electric vehicles will definitely be increased in the upcoming years. We will do so, so that we expect that in two to three years’ time, the profitability of an electric vehicle will be roughly on a par with a combustion engine vehicle.”

Mr Duesmann said Audi is already on track with that goal. “We’ve got good examples actually already here. If you only look at the Q4 e-tron family in Europe, it already has a comparable margin level as the Q3 family worldwide,” he said.

Audi Media Days 2021
The Q4 e-tron doesn’t burn fuel, but it also doesn’t burn cash

Mr Duesmann said “group synergies” would give Audi the cost savings to make its electric cars profitable, meaning it will share platforms and technologies with parent Volkswagen and sister brand Porsche, as well as its own subsidiary, Bentley Motors. “We have to bundle our forces,” he said.

Sounds like a plan to us.

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About the Author

Lionel Kong

An old hand from the bad old days of crazy COEs, the straight-shooting, ex-CarBuyer editor is back in the four-wheeled world. Rumours that he went to another country to start a Judas Priest tribute band are unfounded.

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