Audi Continues Success:
Annual Press Conference



OF 2005

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23rd February, 2006

Audi has posted record figures again in the 2005 financial year for revenue, profit before tax, production and vehicle sales.

“This year we will be increasing the frequency with which new models are launched and we will be presenting an average of one new model or new variant each month,” said Prof. Dr. Martin Winterkorn, Chairman of the Board of Management of AUDI AG, at the Annual Press Conference in Ingolstadt today, with reference to the past and current financial years.

“We have made an outstanding start to 2006, with all major markets reporting a significant increase in sales. We are particularly pleased about the number of customer orders we have already received for the Audi Q7 – more than 13,000 – which is due to be launched in Central Europe on March 10,” said Winterkorn.

Rise in revenue and profit before tax
The revenue generated by the Audi Group was up by 8.5 percent in 2005 to EUR 26.6 billion. Profit before tax was up by as much as 14.6 percent to EUR 1,310 million, the highest figure in company history.

“This verifies our strategy of systematically increasing performance and optimising costs,” stressed Rupert Stadler, Board Member for Finance.

The company’s high profitability is the result of efforts to further increase productivity in all areas. Profit after tax amounted to EUR 824 million.

Efficient investment management
The Audi Group intends to maintain the high level of capital investments of recent years in the future. Within the scope of the company’s mid-term investment plans from 2005 to 2010, funds totalling EUR 10.8 billion have been earmarked within the Audi Group.

“Around three quarters of these funds will be channelled into new products. But we will also invest in product-related areas such as research and development as well as in other sales activities,” says Stadler.

Total capital investments in 2005 amounted to EUR 1.7 billion. This figure is set to rise to just under EUR 2 billion a year by 2007.

“By means of efficient investment management, we made optimisations wherever possible, without neglecting the necessary investments in our products. After all, over the next three years we want to launch at least six new models on the market which are all new additions to the company’s product portfolio,” said Stadler.

Record vehicle sales for the tenth time in succession
The Audi brand set a new record for vehicle sales in 2005 for the tenth year in succession: 829,109 vehicles were delivered to customers worldwide, an increase of 6.4 percent (2004: 779,441*). Best-ever figures were recorded in 39 sales markets worldwide, including Australia (up 30% in 2005).

The largest individual export market is the USA with 83,066 units (77,917, up 6.6 percent), followed by Great Britain with 81,374 (77,882, up 4.5 percent) and China with 58,878 (53,702, up 9.6 percent)**.

The highest growth rate among the major European markets was achieved by Spain, which recorded an increase of 13.0 percent to 49,453 units (43,764). Next in the list of the markets boasting the highest growth rate was France with an increase of 10.1 percent to 41,498 (37,676) and Italy with an increase of 10.0 percent to 55,574 units (50,500). Audi sold 247,125 vehicles in Germany, 12,033 (5.1 percent) more than in 2004.

The above-average growth of Audi in Western Europe led to the Ingolstadt brand achieving a record market share of 4.2 percent in 2005.

The positive development in Eastern Europe continued in 2005 with growth of 19.9 percent. Audi recorded an outstanding result in Russia in particular, with growth of 49.1 percent to 6,115 units (4,100).

Of the overseas markets, above-average figures were recorded by Japan with an increase of 11.9 percent to 15,388 vehicles sold (13,751), Australia (up 29.9 percent to 4,808), South Korea (up 190 percent to 2,200), South Africa (up 17 percent to 11,802) and the Gulf States (up 23.1 percent to 3,008). The company recently set up its own importer companies in Australia, South Korea and for the Gulf States.

Lamborghini vehicle sales were approximately on a par with the previous year at 1,600 sports cars (1,592).

Vehicle and engine production at a record level
Car production (including Lamborghini) rose by 3.4 percent in 2005 to a record level of 811,522 units. In the year that celebrated 25 years of quattro, the proportion of Audi vehicles fitted with permanent four-wheel drive reached 27.1 percent. Engine production was up by 14.1 percent to 1,695,045 units.

Succession of new models and growth help to keep jobs secure
The number of employees as at 31st December, 2005 remained at the previous year’s high level – 52,430 (53,089) employees – despite the sale of the subsidiary COSWORTH TECHNOLOGY LIMITED (723) with effect from 1st January, 2005. 44,970 (44,972) people were employed at AUDI AG, including 31,337 (31,202) in Ingolstadt und 13,633 (13,770) in Neckarsulm. AUDI HUNGARIA MOTOR Kft. employed a workforce of 5,022 (5,074) employees, the Lamborghini Group had 681 (721) and AUTOGERMA S.p.A. 845 (774) employees. With 2,236 (2,181) apprentices in 20 professions, the number of apprentices at the Ingolstadt and Neckarsulm plants reached the highest level ever in company history.

Outlook for 2006: further growth
“No brand will grow like Audi in the near future,” stressed Audi Chairman, Prof. Dr. Martin Winterkorn.

“We are planning to sell significantly more vehicles in 2006 than in the record year 2005. We have our sights set firmly on the mid-term sales target of one million vehicles.”

Audi’s growth strategy rests on three pillars. First, to expand the model range to include not only sporty derivatives of the core model lines, but all above new products in previously unoccupied segments and niches.

Second, to exhaust the potential of existing markets more effectively by systematically improving both product range and quality, and by further optimising the dealer organisation and range of services.

And third, to systematically open up new growth markets, above all in the regions of Asia and Central Europe and in the Middle East.

For the coming year, Winterkorn also announced a further increase in productivity and a reduction in production time.

“This is the only way we will able to survive in the face of international competition,” he stressed. “But thanks to significant growth, the number of jobs will remain at today’s high level,” reassured Winterkorn.

* ) Prior-year figures and growth rates in brackets
**) The statistics for China were converted to sales to customers from January 1, 2005 (in accordance with other markets).

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