Audi cuts costs for its 2016 investment plan image

Audi, Volkswagen’s luxury division, is looking to temper its financial plans for the following year and the first thing on its list is to postpone building an originally planned new wind tunnel.

The carmaker has made this decision after Volkswagen was involved in a cheating scandal regarding emissions tests for its cars worldwide, which led to numerous recalls and fees for the German carmaker. Audi has made a bigger operating profit than the entire VW group in the first nine months of this year and states that it would invest over $3.3 billions in factories and equipment in the following year.

The previous budget for Audi that was announced a year ago was worth $18.5 billion over a period of four years between 2015 and 2019 or an annual average investment of $3.71 billion.

Axel Strotbek, head of finance for Audi, stated that “With the current investment program, we obviously want to enhance the brand’s strong position, but at the same time, we aim to achieve additional financial scope by means of further process and cost optimization.”

Audi’s decision comes into action after Volkswagen, which is the biggest auto group in Europe, reduced its 2016 investment plan in November by almost $1.1 billion.

However, Audi explained that the company is not saving money in the detriment of future growth for the brand, but rather that it is examining closely every decision to be made for the carmaker at a micro level. Therefore, the Board of Management announced that Audi would postpone the construction of a new wind tunnel for one year.