Audi predicts tough year amid model changes

INGOLSTADT, Germany -- Audi expects a difficult year as the launch of over 20 redesigned and new models could hurt deliveries, after declining sales of high-end models and further costs from an emissions scandal kept profitability below that of premium rivals Mercedes-Benz and BMW.

Volkswagen Group's main profit engine will introduce a new model every three weeks this year, including the redesigned A6 sedan, the all-new Q8 SUV and the battery-powered e-tron SUV, the automaker said on Thursday.

Bottlenecks expected from introducing new vehicle tests done to harmonized world standards will add further strain, Audi said.

"This means an enormous feat of strength for us," CEO Rupert Stadler said. "2018 will be a year of transition."

The model replacements caused Audi to refrain from projecting another outright increase in deliveries, saying it wants to at least match last year's record 1.88 million sales.

Revenue is expected to slightly exceed last year's 60.1 billion euros.

The model offensive, also including the overhauled Q3 compact SUV, is expected to have a "sustained positive impact" on deliveries and earnings starting in 2019, Audi said.

The luxury brand achieved 1 billion euros of cost reductions last year as part of a goal to cut spending in r&d, sales and other departments by 10 billion euros by 2022 to free up funds for its electric-car program.

Also backed by a new joint platform with VW sibling brand Porsche, Audi plans to launch about 20 electrified models by 2025, more than half of which will be full-electric vehciles.

The financial toll on the company from Volkswagen Group's diesel scandal was 387 million euros ($478 million) last year. Audi expects no further provisions to cover costs related to the scandal this year.

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