Audi wants to rein in costs by about $2.5 billion a year to offset surging spending on new technology, according to people familiar with the matter.
The world’s second-largest maker of luxury cars will seek to limit expenditure growth in areas such as development, purchasing and manufacturing to safeguard profit margins, said the people, who asked not to be identified as details of the initiative are confidential.
Audi CEO Rupert Stadler outlined “a fitness program” in a July letter to employees, saying the company must brace for the increasing cost of developing electric vehicles, self-driving and communications features and new plants. Julio Schuback, an Audi spokesman, referred to Stadler’s recent statements and declined to comment further.
The biggest earnings contributor at parent company Volkswagen AG, Audi is introducing 17 new or revamped models in 2014, and has revived development of an electric version of the R8 sports car to advance its goal of surpassing premium-market leader BMW.