FRANKFURT -- Audi cut its earnings outlook and said it expects substantial additional costs triggered by parent Volkswagen Group's diesel-emissions manipulation scandal.
Audi anticipates an additional hit of 620 million euros ($676 million) in the third quarter, it said in a statement today.
Audi now forecasts that the full-year operating return on sales will be "considerably below" a target corridor of 8 to 10 percent, rather than missing that range slightly. Excluding special items the margin is anticipated to reach the target corridor.
VW Group has made some progress in resolving the scandal involving software that enabled diesel cars to cheat on emissions tests following U.S. court settlement this week, though it still faces potential criminal charges and lawsuits.
Audi today said that its extra costs also stem from recalls to fix cars equipped with faulty air bags from supplier Takata Corp.
Audi is VW Group's biggest profit contributor.