Audi, the luxury car maker, said today that its second-half revenues would be affected by the strengthening euro and reiterated its forecast to sell one million cars in 2008 — 35,000 more than last year.

The company also hinted at possible price increases to offset the tougher economic conditions.

Audi, which is owned by Volkswagen (VW), Europe's biggest car company, said first-half profit rose 37 per cent because of demand for the new A5 Coupe and A4 sedan. Net income increased to €930 million (£743 million) from €679 million a year earlier.

The result was achieved in a more difficult climate, with higher raw material prices, weaker currencies in key markets and a weakening economy overall, the company said.

Axel Strotbek, Audi's chief operating officer, said the company was “confident in growth of sales and operating profit” compared with 2007.

He said some of the costs of higher raw materials and negative effects of currencies may be passed on to customers. "These negative impacts will be, in one way or another, offset by possible price increases," Mr Strotbek said.

Audi reiterated its forecast to sell one million cars this year compared with 964,151 last year. Yesterday, Peugeot Citroën, also owned by VW, said its sales would fall by 4 per cent this year.

Audi, which competes with BMW and Daimler-owned Mercedes-Benz, plans to increase its offering from 25 at present to 40 models over the next seven years. The company could become an asset of rival Porsche, which is positioning to take over VW.

The sports car manufacturer has a 31 per cent stake in VW and intends to increase its holding. Porsche won permission this week from the European Commission to take control of VW.

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