At Audi, A Plan to Cut Costs, Invest in Technology

Audi factory
The technology behind the prestigious Audi badge comes at a price.
  • Why it matters

    Why it matters

    The world’s second-largest make of premium cars wants to overtake BMW by 2020.

  • Facts


    • Audi CEO Rupert Stadler said the auto industry is going through an upheaval.
    • Global car sales will rise 2 percent to 3 percent by 2020, to 80 million, he said.
    • Audi and parent company Volkswagen are watching expenditures closely.
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Rupert Stadler, the chairman of Audi, couldn’t focus on the lobster on his plate. Instead, his attention focused on the future of Audi, its parent company Volkswagen and the auto industry in general.

The industry, according to Mr. Stadler, is facing the biggest transition in decades. Electric cars and the like will devour billions in development money in the coming years. Car buyers’ needs will continue to evolve, and the use of multimedia will turn cars into rolling smart phones.

Change doesn’t come without a price, he said: “We are being forced to pay in advance,” referring to Audi’s need to massively invest in new technologies. Whether the customer will also end up paying is an issue faced by industry experts.

Mr. Stadler made clear Audi’s current investment program will not increase beyond €22 billion ($28.88 billion). The corporation wants to use a “fitness program” to keep a keener eye on expenditures in order to make the investment money accomplish more, he said. Mr. Stadler, 51, doesn’t let the term “austerity program” pass his lips. It might draw attention to the parent company’s crisis. Germany-based Volkswagen plans to save €5 billion in its core brand, VW, company head Martin Winterkorn recently announced. Mr. Stadler said Audi’s focus on expenditures started a year ago – long before the parent company’s announcement.

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