Audi is considering closing its Brussels plant that produces electric vehicles, due to a global decline in demand for high-end electric cars.
The Volkswagen-owned manufacturer said it is weighing up the "early end of production" of its Q8 e-tron models at the factory.
Management are discussing "solutions for the (Brussels) site," and this "may also include a cessation of operations if no alternative is found", it said in a statement.
The site employs about 3,000 people.
Audi cited a "global decline in customer orders in the electric luxury class segment" as a reason.
After investing heavily in the shift to electromobility in recent years, carmakers have been hit hard in recent times by slowing demand for electric vehicles.
Volkswagen - whose 10 brands also include Porsche, Seat and Skoda - said closing the Brussels plant, or finding alternative uses for it, as well as other unplanned expenses would have an impact of as much as 2.6 billion euros (R51 billion) in the 2024 financial year.
As a result, the auto giant lowered its forecast for operating returns this year to 6.5 - 7.0 percent from 7.0 - 7.5 percent previously.
As well as the slowdown in demand for electric cars, Audi cited "long-standing structural challenges" at the Brussels site.
These include a plant layout that is hard to change and high logistics costs.
A consultation process will now be carried out about next steps, Audi said.
"The announcement of the intention does not mean that a decision has been made," said Volker Germann, CEO of Audi Brussels.
"Nevertheless, this news has been felt very profoundly by the employees in Brussels."
Rita Beck, spokeswoman for the Audi Committee in the European VW Group Works Council, said Audi staff representatives were "calling for long-term prospects for the plant and our colleagues in Brussels. Audi management must take responsibility for the site."
In the first quarter of this year, Volkswagen reported a more than 20-percent fall in profits with deliveries of more expensive models, including Audis, slipping.
AFP