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German carmaker Audi is seeking to reduce its workforce by cutting non-production jobs in the medium term, thousands of jobs at risk, local time reported on Thursday. The layoffs will focus on indirect jobs, such as development, and the company aims to reduce them by about 15%, affecting 4500 indirect jobs in Germany alone, the report said. Audi confirmed the authenticity of the layoffs to foreign media, and the management committee is currently negotiating with workers' representatives, but declined to disclose the exact number of layoffs.

Audi's layoffs have something to do with its business performance. A few days ago, Audi Group released its third-quarter results for 2024, showing operating revenue of 15.322 billion euros, down 5.5% from the same period last year, and operating profit of 106 million euros, down 91.0% from the same period last year. Audi said in the financial report that the decline in revenue and profit was mainly attributed to "restructuring expenses for the restructuring of Audi's Brussels plant."

The Brussels plant in Belgium is Audi's first factory specializing in the production of electric vehicles, mainly responsible for the production of Audi Q8 e-tron. In 2023, the plant produced 53555 pure electric vehicles, accounting for about 30 per cent of Audi's annual delivery of 178000 electric vehicles. Due to depressed product sales, Audi announced as early as July that it would not rule out the possibility of closing the Brussels factory. Audi said that it made employees feel more likely to be laid off. The factory has about 3000 employees a month, and according to CCTV, the factory has been shut down since the beginning of September. Audi plans to reorganize the Brussels factory, which triggered several demonstrations by workers. Audi is required to clarify the future prospects of the factory and its employees. At present, Audi has not yet decided whether to sell the factory, but according to Audi's latest statement, the sale of the factory is a high probability event, if the factory closure means that a large number of workers have lost their jobs.

In addition, the decline in revenue and profits is also related to the performance of the global market. J ü rgen Rittersberger, Audi's chief financial officer, said the company faced fierce competition for car prices in both the European and Chinese markets. In the third quarter, Audi Group delivered a total of 407390 Audi, Bentley and Lamborghini cars, of which Audi was 402633, down 16.0% from a year earlier, Bentley was 1904, down 35.6% from a year earlier, and Lamborghini was 2853, an increase of 18.7%. In terms of specific market, Audi's sales in the United States fell 16.8% year-on-year to 139665 vehicles. The European and Chinese markets are also not optimistic, with sales falling 9.8 per cent and 8.5 per cent, respectively.

Volkswagen Group's high-end brands, including Audi, Lamborghini and Bentley, as well as motorcycle brand Ducati, are facing increasing competition in the Chinese market, where consumers are increasingly inclined to choose local brands. Weak demand for electric vehicles and increasing competition for electric vehicles have forced Volkswagen to implement cost-cutting plans. Volkswagen Group and labor representatives are currently negotiating a series of cost-cutting measures affecting its core brand Volkswagen, including factory closures, layoffs and wage cuts.

In addition to Audi, the good days for Mercedes-Benz and BMW in the Chinese market seem to be gone forever, with both companies cutting their performance forecasts by 2024. A few days ago, Mercedes-Benz released its third-quarter results, showing a decline in all its major financial indicators, not only harvesting the lowest single-quarter revenue in nearly three years, but also directly halving its net profit compared with the same period. According to the financial report, Mercedes-Benz's operating income in the third quarter was 34.528 billion euros, down 6.7% from the same period last year; profit before interest and tax was 2.517 billion euros, down 48% from the same period last year; and net profit was 1.719 billion euros, down 53.8% from the same period last year.

The same is true of BMW, which had revenue of 32.406 billion euros in the third quarter, down 15.7% from a year earlier. Of this total, revenue from the automobile business was 27.854 billion euros, down 13.2% from the same period last year. Third-quarter profit was 1.696 billion euros, down 61% from a year earlier. Of this total, the profit of the automobile business was 634 million euros, down 79.8% from the same period last year. In the third quarter, China was BMW's single market with the biggest decline in the world, with single-quarter sales falling 29.8 per cent year-on-year to 147700 vehicles.

In the automobile market, where the problem of survival and development is becoming more and more serious, in the face of the problem of "grabbing the head" to sell cars and seeking transformation, reducing costs and increasing efficiency is the biggest demand of all automobile companies, while layoffs have become the most "simple and brutal" solution.

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