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NINETY EIGHT REGENCY

Chief: Audi is 'short of everything'

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Chief: Audi is 'short of everything'

Diana T. Kurylko

Automotive News -- April 12, 2010 - 12:01 am ET

Audi is losing U.S. sales because inventory is too lean after a strong first quarter, says Audi of America President Johan de Nysschen. "We are short of everything," he says.

Audi has half the inventory it normally carries. To ease the shortage, Audi will get 3,000 units above its requested allocation for 2010, de Nysschen says. He says the shortage of Q5 and Q7 crossovers is particularly acute.

In the first quarter Audi sold 21,315 vehicles in the United States, up 35 percent from the same period in 2009. On April 1, Audi had a 29-day supply of vehicles. For comparison, the supply hit a recent peak of 88 days in February 2009.

The shortage was caused by the company's decision to cut the U.S. allocation for 2009 by 6,000 vehicles because of the U.S. sales meltdown, de Nysschen says. But sales were brisker than expected in late 2009 -- especially in December -- and the momentum continued through March, he says.

Looking on the bright side, de Nysschen says vehicles are selling quickly, cutting financing and other costs for dealers.

Audi also was able to keep incentive spending flat during the first quarter while the rest of the industry pumped money into spiffs to compete with beleaguered Toyota's deals. De Nysschen says Audi is using the incentive money primarily to boost residuals on leased cars.

Read more: http://www.autonews.com/article/20100412/RETAIL03/304129977/1295#ixzz0ktWxcqw8

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