The first half of 2025 has been tough for Audi. The brand’s first-half sales report acknowledges that. Sales are down, and Audi provides two reasons: tariffs in the US and its “restructuring expenses.” “The situation continues to be very challenging,” said Audi CFO Jürgen Rittersberger. However, the company is confident this drop in sales isn’t a sign of things to come. Rather, the company says its Q1 and Q2 sales figures are, in some ways, necessary, and also a sign that the brand is transforming itself.
Audi’s Sales Are Down, And It Blames Tariffs
In part at least, American tariffs are to blame for Audi’s 6 percent overall sales drop. After a promised 25 percent tariff on European goods, President Donald Trump and the EU agreed to new rates, but not before automakers were forced to react. Audi initially suspended shipments to the US altogether back in April. Then, the automaker and the Volkswagen Group as a whole joined negotiations, stating they’d be willing to build Audis in the US to help duck lofty import fees.
Audi is effectively trading short-term profit for long-term gains
Now, a deal has been reached that will go into effect on August 1st. Cars and parts will be subject to a 15 percent tariff, down from 27.5 percent. The European Commission said it would also eliminate remaining low-level duties on industrial goods from the United States. The import duty on cars would be cut from 10 percent to 2.5 percent. As a result of the past seven or more months of uncertainty, Audi says its American deliveries fell 9 percent. “Challenging economic conditions and the delayed impact of the current model initiative,” says the automaker.
A Big Bet On EVs Is Paying Off (Mostly)
The “current model initiative” Audi mentions in its statement is a reference to its shift towards electrified models and a massive refresh of its current lineup. Audi will have “the youngest portfolio in the premium segment” by the end of this year, and many of them will be PHEVs — the brand will introduce ten new ones before 2025 is out. The transition towards a newer, more electrified lineup is already paying dividends, despite the decline in sales for the first half of the year.
Audi is effectively trading short-term profit for long-term gains: In the first half of 2024, the group, which includes Lamborghini, Bentley, and Ducati, recorded 13.46 billion in profit compared to last year’s 21.54 billion, a decline of 37.5 percent. That’s a shocking decline, but for now at least, the strategy appears to be paying off for the automaker. Deliveries of the brand’s EVs rose by a strong 32 percent, driven in part by strong demand for them outside the US. While a tough economic situation and fickle demand for EVs and hybrids in the US contribute to lower sales, Audi is also navigating what is likely a temporary political climate in the US. Administrations come and go, and US EV initiatives can change from one president to the next.
TopSpeed’s Take
Audi may continue to rely more heavily on gas-powered vehicles in the US while it focuses on its new lineup globally. The automaker is still making quite a lot of money despite its sales decline, and the brand has continued to emphasize its performance models, like the , here in the US. American buyers may miss out on some electrified versions of new Audi products as a result of the decidedly anti-EV policy being pushed by the Trump administration, however.
Read the full article here