Audi mulls closing Brussels plant as EV demand falters

BRUSSELS

German luxury carmaker Audi said on July 9 it is considering closing its Brussels plant making electric vehicles due to a global decline in demand for high-end electric cars.

The manufacturer, whose parent company is Volkswagen, said it is weighing up the "early end of production" of its Q8 e-tron models at the factory.

Management are discussing "solutions for the [Brussels] site," and this "may also include a cessation of operations if no alternative is found," it said in a statement.

The site employs about 3,000 people.

Audi cited a "global decline in customer orders in the electric luxury class segment" as a reason.

After investing heavily in the shift to electromobility in recent years, automakers have been hit hard in recent times by slowing demand for electric vehicles.

Volkswagen, whose 10 brands also include Porsche, Seat and Skoda, said closing the Brussels plant, or finding alternative uses for it, as well as other unplanned expenses would have an impact of as much as 2.6 billion euros ($2.8 billion) in the 2024 financial year.

As a result, the car giant lowered its forecast for operating returns this year to 6.5-7.0 percent from 7.0-7.5 percent previously.

As well as the slowdown in demand for electric cars, Audi cited "long-standing structural challenges" at the Brussels site.

These include a plant layout that is hard to change and high logistics costs.