VW'S AUDI SAYS PROFIT FELL AROUND 50 PCT IN 1986

  Audi AG &lt;NSUG.F>, the 99 pct owned
  subsidiary of Volkswagen AG &lt;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.
  

