Audi Stumbles Despite Sales Surge as Global Competition Pressures 2025 Profits

German automaker Audi, owned by Volkswagen Group, reported a sharp decline in its first-quarter 2025 profits, announcing earnings of €630 million, a 14.4% decrease compared to the same period last year, which was already relatively weak.
The company attributed the decline to intensifying competition, particularly in Asian markets such as China, as well as ongoing global political instability that has negatively impacted consumer confidence.

Audi’s CEO emphasized that this year would remain "full of challenges," affirming that the company is relying on the launch of new models to boost performance, alongside restructuring efforts that include plans to cut 7,500 jobs in Germany by 2029.
This strategic shift comes shortly after both Mercedes-Benz and Volkswagen reported weak results as well, reflecting broader challenges facing the German automotive sector, especially amid changes in the electric vehicle market and global trade volatility.

Rising Sales Fail to Offset Profit Decline

Despite the profit dip, Audi’s sales rose from €13.7 billion in the first quarter of 2024 to €15.4 billion this year. However, the increase in sales volume was insufficient to offset heavy pricing pressures stemming from fierce competition, particularly with the rapid expansion of Chinese car manufacturers.
Audi's profits from its Chinese operations also fell slightly to €170 million, raising concerns about the brand's future in the world's largest auto market.

Conversely, Audi’s luxury subsidiary Lamborghini continues to perform strongly, buoyed by robust demand for high-end sports cars, providing a limited but vital cushion for the German group amid mounting global challenges.