Audi's operational profit last year plummeted to 2.6 billion euros, marking a drop of over 40 percent, which is indicative of the company's declining performance.

In 2024, Audi sold only 1.7 million vehicles globally, a decline from nearly 2 million in previous years, highlighting the company's struggles in the market.

Amid these challenges, Audi has abandoned its goal to transition exclusively to electric vehicle production, further complicating its future strategy.

The trend of downsizing is widespread, affecting other companies like Thyssenkrupp and BASF, which announced deep cuts last year, and Commerzbank, which plans to reduce about 3,900 jobs by the end of 2027.

Audi has announced plans to cut 7,500 jobs in Germany by 2029, following similar layoffs from Volkswagen and Porsche as the automotive industry faces significant challenges.

The ongoing recession in the European market has prompted both Audi and Siemens to implement substantial layoffs, reflecting the difficult landscape for manufacturers.

In 2024, Volkswagen reached an agreement with the union to gradually eliminate 35,000 jobs by 2030 while implementing salary restrictions, aiming to avoid forced layoffs.

This wave of layoffs follows a critical period at the end of 2024, with early 2025 showing no signs of recovery in the automotive industry's performance.

These job cuts reflect a broader trend among major German companies adapting to decreased demand, which poses a threat to growth in Germany, the largest economy in Europe.

The layoffs will significantly impact the Neckarsulm production site in Baden-Württemberg and the Ingolstadt plant, both crucial to Audi's operations.

The automotive sector in Germany has struggled with a downturn in sales, job cuts, salary reductions, and factory closures, making 2024 particularly challenging, with little improvement expected in 2025.

Recent results from Audi were notably worse than those of its German competitors, who also reported disappointing annual figures amid reduced demand.