Audi wants to boost efficiency and lower costs on all levels of its operations

Article by Christian A., on August 2, 2014

The chief executive of German luxury carmaker Audi -- Rupert Stadler -- will initiate a drive to increase efficiency while reducing costs on all operating levels, a senior company source told Reuters.

Citing a letter to be sent by the CEO to Audi’s employees, the source said the luxury brand will roll out a "fitness program" aimed at securing future growth while facing an emerging market volatility, fragile European demand and increasing technology costs.

Stadler warned them that high fixed costs could hamper a company’s capability to act. To offset hiking expenditures and growing uncertainties with earnings, Audi will launch a fitness program to improve efficiency and lower costs.

While Audi logged record deliveries in 2013, its operating profit margin dropped to 10.1 percent from 11 percent in 2012. The fitness program should enable Audi to keep up with rivals BMW and Mercedes-Benz, which both recently announced cost-savings measures.

Stadler will say in the letter that Audi will implement measures to generate synergies in vehicle development, procurement, production and sales, Reuters said.

The drive, however, may not affect Audi's record investment program that currently being implement. Audi is spending EUR22 billion ($29.43 billion) through 2018 on factories, models and equipment. [source: Reuters]

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