Audi CEO sees chip shortage as perfect storm but will get through it – Reuters

” We had a very strong first half in 2021. We do expect a much weaker second half. We actually have difficulty,” Markus Duesmann told Reuters ahead of the Reuters Events Automotive conference, calling the circumstance “a perfect storm”.
Audi in July stated it had actually been not able to develop a mid five-digit number of vehicles in the very first half of the year. Its revenue margin in the period rose to 10.7%, even surpassing the 8% in 2019 prior to the pandemic struck.

FRANKFURT, Oct 4 (Reuters) – Premium automobile brand Audi, Volkswagens (VOWG_p. DE) biggest profit factor, needs to repair on an everyday basis to deal with an ongoing shortage of automobile chips, its chief executive said.
” We had a very strong very first half in 2021. We do expect a much weaker 2nd half. We really have difficulty,” Markus Duesmann told Reuters ahead of the Reuters Events Automotive conference, calling the circumstance “a best storm”.
Duesmanns remarks highlight the issues global carmakers are facing in browsing a worldwide chip supply crunch that has actually struck automobile production worldwide.
However while the automobile markets automobile sales have actually suffered it has actually softened the blow through rate boosts that have actually enhanced margins.
Audi in July said it had actually been not able to build a mid five-digit variety of cars and trucks in the first half of the year. However its profit margin in the duration rose to 10.7%, even going beyond the 8% in 2019 prior to the pandemic struck. find out more
” We are handling it pretty well I would state,” Duesmann, who also rests on the management board of Volkswagen, said. He stated the group was seeking closer ties with chipmakers which the carmaker would emerge stronger from the crisis.
” But at the moment its an everyday troubleshooting procedure,” he said.
Audi, which accounted for more than a quarter of Volkswagens first-half operating revenue, has actually embarked on an enthusiastic shift towards battery-powered vehicles, implying all new models it will launch from 2026 will be fully electric.
Meantime, production of internal combustion engines will be slowly phased out up to 2033. Audis CFO in August stated it would just take 2-3 years prior to profitability of electrical lorries (EV) would match that of combustion engine cars and trucks.
Duesmann thinks this might happen a lot more quickly.
” The point where we earn as much cash with electrical vehicles as with combustion engine cars is now, or … next year, 2023. They are really even now, the costs,” Duesmann stated.
Apart from efforts to challenge Tesla (TSLA.O) and become the greatest seller of EVs, Volkswagen, the worlds No. 2 carmaker, is also doubling down on efforts to develop software, which CEO Herbert Diess said is the markets real gamechanger. find out more
Duesmann, who took over as Audi CEO in 2015, has previously stated that Volkswagen would make the majority of the vehicle software needed for the groups transformation by itself and that it was prematurely to think of collaborations. find out more
” Because at the minute … it would eliminate speed, it would include intricacy,” Duesmann said. “Certainly we might share our software application platform with other automotive companies but thats more mid-term, long-lasting … 5-10 years.”
Duesmann, a previous BMW (BMWG.DE) executive, now likewise has obligation for high-end brand names Lamborghini, Ducati and Bentley which have been brought under the Audi roofing.
The 52 year-old Ducati lover rejected recurring speculation that one of them might be offered, although there was regular outdoors interest.
” These brand names … are really important really successful brands, where we can even expand the synergy level in the future,” Duesmann stated. “There are no plans whatsoever to get rid of them.”
Reporting by Christoph Steitz. Editing by Jane Merriman
Our Standards: The Thomson Reuters Trust Principles.

Markus Duesmann, board member of German luxury carmaker BMW goes to the companys annual press conference in Munich, Germany, March 21, 2018. REUTERS/Michael Dalder

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