VW'S AUDI SAYS PROFIT FELL AROUND 50 PCT IN 1986
Audi AG <NSUG.F>, the 99 pct owned
subsidiary of Volkswagen AG <VOWG.F>, said profit in 1986 fell
by around half compared with 1985, when it achieved a record
221 mln marks net profit, a rise of 19.5 pct on the previous
year.
    Managing board chairman Wolfgang Habbel told a news
conference he expected both profit and turnover to rise this
year compared with 1986, but he said it was questionable
whether 1987 profit would return to 1985 levels.
    He gave no figure for 1986 profit. Audi had predicted last
year that 1986 profit would likely fall by an unspecified
amount from 1985's record levels.
    Habbel said turnover in 1986 rose to 9.9 billion marks from
9.6 billion in 1985 and looked certain to rise to over 10
billion this year.
    Asked whether Audi would pay a dividend to VW to help the
parent company overcome its currency losses, Habbel said Audi
would ensure VW got a share of profits.
    Audi's entire 1985 net profit was paid into its own free
reserves to help finance investment. In the previous 10 years
VW had received 80 pct of Audi's earnings as a dividend.
    Habbel blamed the profit decline on disruptions to output
caused by the introduction of the new Audi 80 model, on
currency factors and on negative publicity in the U.S. About
alleged "sudden acceleration" of some of its Audi 5000 models.
    As reported, Audi's sales in the U.S. Dropped nearly 20 pct
to 59,800 last year.
    Habbel said the U.S. Sales decline would probably bottom
out in 1987.
    Audi's worldwide car deliveries fell two pct to 363,000.
    Of the total, exports fell 10.5 pct to a rounded 210,000,
but domestic sales increased to a rounded 154,000 from 137,180
in 1985.
    Habbel said the new Audi 80 had sold extremely well in the
first two months of 1987, helping Audi to increase its overall
market share in West Germany to 8.4 pct from 5.2 pct in the
same months of 1986. Sales in Europe also rose but U.S. Sales
fell further, he said without giving details. Worldwide
deliveries in the first two months increased eight pct to
57,000.
    Audi said in January that 1987 car production would rise to
over 400,000 from 384,000 in 1986, when output had fallen
compared with 1985's 392,000.
    Habbel said Audi expected the rise in output to lead to
further new hiring of employees.
    At the end of 1986 Audi's workforce stood at a record
39,800, a rise of 3,400 over 1985.
 REUTER
