Audi 2007 Annual Report Download - page 171

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Anticipated financial position
The Audi Group again expects to be able to finance its ambitious growth entirely from inter-
nally generated cash flow in 2008, without recourse to external sources of financing. All
Group companies are assured the necessary liquidity through the Group’s own cash pool.
Cash flow from operating activities is expected to reach a level similar to that in 2007.
Cash used in investing activities will probably rise year on year as the long-term model ini-
tiative continues.
The Audi Group’s net liquidity will continue to develop on a positive note up until the end
of 2008, despite higher capital expenditures.
Capital investments
Capital investments scheduled for the medium term are intended predominantly for cus-
tomer-driven additions to the model and engine lines, the resulting need for expanding
development and production structures, for improving the productivity and quality of pro-
cess chains, and for strengthening customer loyalty. All investment measures share the
common objective of sustainably strengthening the Audi Group’s market position through a
forward-looking model and brand strategy.
The investment volume for property, plant and equipment envisaged for the period from
2008 through 2012 amounts to around EUR 10.6 billion for the Audi Group, with the 2008
fiscal year accounting for around one-fifth of this total. Cash flow from operating activities
will cover investment spending in full for the entire planning period.
Capital investments will principally relate to manufacturing operations.
Anticipated development of the workforce
The size of the workforce will increase moderately in 2008 by comparison with the past fis-
cal year. The main factor at work here is that AUDI BRUSSELS S.A./N.V., with around 2,100
employees, is being comprehensively consolidated for the first time starting in early 2008
following the transfer of management responsibility from Volkswagen AG to AUDI AG.
Opportunities for future development
The Audi Group’s future development will essentially be driven by forward-looking strate-
gies and measures designed to assure the Company’s steady, profitable growth.
Systematic renewal and expansion of the product portfolio will play a key role. Following
the successful launch of numerous new models during the past fiscal year, the long-term
model initiative will continue seamlessly in 2008 with important market launches such as
the Audi A3 Cabriolet, the Audi TTS models, the new Audi A4 Avant, the Audi RS 6 Avant and
the Audi Q5.
Sustaining growth in established markets will once again be an important target for
2008. The main focus areas will include restructuring the sales organization in North Amer-
ica and continued expansion of the worldwide exclusive Audi dealer and service network.
The Audi Group will also be stepping up its involvement in growth markets and actively
tapping into new markets.
All in all, the Audi Group expects the above measures to provide lasting growth pros-
pects that will drive the development of the Company’s unit sales as well as its financial
performance over the coming years.