INGOLSTADT, Germany - Germany's Audi said on Wednesday pre-tax profit fell over 11 percent to 1.11 billion euros ($1.4 billion) in 2003, meaning Volkswagen's luxury unit alone generated over 70 percent of VW's profits.
Audi, which the year before had accounted for just less than one-third of the pre-tax earnings at at Europe's biggest carmaker, said in a statement that net profit rose 5 percent to 816 million euros last year.
Audi said it expected stable earnings this year.
"Audi is expecting a stable earnings situation (in 2004)," it said ahead of its annual news conference. "The year (2004) has started well for Audi," Chief Executive Martin Winterkorn said in the text of a speech.
Audi also said it wanted to increase both sales and unit sales this year. It said in January that unit sales rose 3.4 percent in 2003 to 767,000 vehicles and that it expected to sell 1 percent to 2 percent more cars this year thanks to the roll-out of updated versions of its A3 hatchback and A6 executive sedan.
Despite last year's record unit sales, the Bavarian firm, which also owns Italy's legendary Lamborghini brand, has seen revenues and profits dented by a strong euro and fierce price competition in a sluggish global car market.
Top rival BMW, based in Munich, said late last month that the euro's recent surge to record highs versus the dollar helped knock 2 percent off 2003 revenues, which would have risen were it not for currency fluctuations.
Audi, like Europe's other luxury car makers, remains very profitable, though, propping up struggling owner Volkswagen, which said last week that operating earnings halved last year.
Audi, whose recently revamped A8 competes with the S-Class Mercedes and BMW 7-Series, saw a tough market dent European revenues last year, although sales in China are in overdrive after it started assembling A4 sedans there.
It said sales rose to 23.41 billion euros in 2003 from 22.60 billion the year earlier.