Audi CEO signals plans to build U.S. plant

INGOLSTADT, Germany (Reuters) - Volkswagen's (VOWG.DE: Quote, Profile, Research, Stock Buzz) premium brand Audi stands to benefit "tremendously" from a U.S. production plant as the carmaker struggles to cope with stiffer external headwinds including the strong euro.

"There are no signs right now of this situation letting up," Chief Executive Rupert Stadler said in remarks to be delivered to shareholders at Audi's annual general meeting on Wednesday.

While Stadler has confirmed several times that he was looking into a cooperation with parent Volkswagen (VOWG.DE: Quote, Profile, Research, Stock Buzz) to build vehicles in the United States, his comments that the company would tremendously benefit from local production are the strongest signs yet that Audi needs a U.S. plant.

Beyond the sharp rise in the euro versus the dollar and the pound, the Audi CEO cited other headwinds as well.

"These challenges include above all the sharp rises in the cost of raw materials. This is true in equal measure for raw steel, precious metals and aluminium," he explained.

Stadler said Audi would continue to reduce the carbon dioxide footprint of its vehicles, reaffirming a target that the brand would cut fuel consumption by at least 20 percent by 2012.

In various model lines it would be able to cut fuel use by as much as 18 percent this year through further internal engine modifications.

"Overall, this will bring our fleet emissions down by an average of 10 grams of CO2 this year," he said.

Audi's average fleet emissions are around 170 grams per kilometer.