Audi CEO drops plan to sell motorcycle brand Ducati

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INGOLSTADT, Germany (Reuters) – Germany’s Audi (NSUG.DE) has deserted plans to promote its Italian bike model Ducati, its chief govt Rupert Stadler mentioned, in an indication of confidence that the carmaker expects to have the ability to carry the prices of its transformation.

The brand of Italian bike producer Ducati is seen in Dietlikon, Switzerland October 11, 2016. REUTERS/Arnd Wiegmann

Steps to cut back prices by 10 billion euros ($11.eight billion), minimize pink tape and deepen ties with fellow Volkswagen-owned (VOWG_p.DE) model Porsche are “step by step rising our monetary and organizational leeway for the strategic realignment,” chief govt Rupert Stadler informed reporters.

There’s due to this fact no financial must promote Ducati, Stadler mentioned. Volkswagen requested banks to judge choices for Ducati and transmissions maker Renk earlier this 12 months as seeks to develop into extra nimble in its shift in the direction of electrical and self-driving automobiles following its diesel emissions dishonest scandal.

“I can guarantee you that Ducati belongs to the Audi household,” mentioned Stadler. “Ducati is the right implementation of our premium philosophy on the earth of motorbikes.”

The plans had already stalled in the summertime when VW’s highly effective labor unions, backed by the controlling Porsche-Piech households, opposed the logic and want for asset gross sales given the group’s monetary resilience.

Buyers and potential Ducati patrons, nonetheless, count on that VW may change its thoughts once more and finally decide to promote the asset which they are saying has least strategic significance to VW.

“For Volkswagen’s highly effective works council it might be a straightforward bargaining chip they may supply to push by means of one thing fully completely different,” an individual near the matter mentioned.

Buyers have lengthy favored divestments to simplify VW’s group construction and to strengthen its administration’s capacity to push by means of structural adjustments in opposition to the unions’ needs.

Audi, which owns Ducati and Italian supercar maker Lamborghini, final month reported larger working revenue and income for the primary 9 months, helped by rising auto demand within the higher-margin western European and U.S. markets.

Whereas pushing the pricey shift to zero-emissions and autonomous applied sciences, holding on to the worthwhile Ducati division and the profitable Lamborghini model has develop into extra vital, Stadler mentioned.

“Taking care of a premium bouquet is as troublesome because the work of a gardener,” Stadler mentioned. “Due to this fact I’m happy with each new flower, with each promising new department,” he added, predicting Lamborghini’s gross sales would double on the again of its new sport-utility automobile.

Individually, Stadler mentioned Audi will spend practically half a billion euros over the following eight years on coaching employees for the digital age, with steps to develop in addition to rent consultants resembling automotive app-designers and automotive robotics specialists.

To rein in prices, Audi desires to maintain headcount steady, no less than over the following 2-Three years, even because it plans to have greater than 20 electrified autos available on the market by 2025 and pushes into digitised mobility companies, the CEO mentioned.

With two-thirds of Audi’s 60 or so fashions by 2025 nonetheless slated to be combustion-engine automobiles, tightening carbon dioxide (CO2) guidelines will pose the “largest threat” in coming years, he mentioned, including that Audi would face 1 billion euros of fines if its common fleet CO2 emissions exceeds EU limits by not more than eleven grammes per kilometers.

Audi has overhauled its whistleblower system to permit home and worldwide employees to flag unlawful conduct extra simply and it has arrange a everlasting investigation workplace.

Audi plans early subsequent 12 months to dissolve a job drive set as much as monitor fixes for 850,000 diesel-fuelled automobiles that the automaker mentioned in July wanted updates with emissions-control software program to assist keep away from potential driving bans.

“It’s an indication that we are able to slowly shift from disaster mode again into customary operation,” Stadler mentioned, predicting the check-ups to be accomplished by the top of the primary quarter.

Extra reporting by Arno Schuetze; modifying by Alexander Smith

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