Audi forecasts margin rebound in 2026 but battles on with tariffs

INGOLSTADT, Germany, March 17 (Reuters) - German automaker Volkswagen's VOWG_p.DE premium brand group Audi expects a recovery in its profit margin this year after tariffs dealt a 1.2-billion-euro blow in 2025, the company said on Tuesday.

Audi expects an operating margin in the range of 6% to 8% in 2026, from 5.1% in 2025 and 6.0% in 2024.

"Geopolitical uncertainties and global competitive pressure kept the automotive industry on its toes again last year," Audi CEO Gernot Doellner said in a statement.

The Volkswagen subsidiary, which includes the Lamborghini, Bentley and Ducati brands as well as Audi, said cost discipline helped to partially offset costs in 2025 that led to a 14% slump in operating profit, to 3.4 billion euros.

Tariff costs are expected to persist at the current level, as questions persist over whether Audi will set up its first U.S. plant to ease the impact.

Like its peers, Audi is battling challenges across its key markets, including strong competition in China.

"We will have to find different answers across regions," Doellner said.

In China, where Audi deliveries slumped 5% in 2025, the brand is trying to win back customers with a 'sister brand' - dropping the German carmaker's famous rings - launching the all-electric E5 Sportback, developed with state-owned Chinese carmaker SAIC.

Sales for the China-exclusive car were below expectations in the first two months of the year, according to finance chief Juergen Rittersberger.