German automaker Audi says steel prices are 'crazy': report

3rd September 2010, Comments 0 comments

The German automaker Audi, which is owned by Volkswagen, is getting worried about "crazy" steel prices, a director said Friday in an interview.

"At the moment, to our great regret, steel prices have gone crazy. Only the fact that all competitors have been hit in the same way makes (the situation) bearable," purchasing director Ulf Berkenhagen told the Financial Times Deutschland.

"We are going to have to see what we can pay for materials for each model," he added.

Like other high-end auto manufacturers, Audi is trying to reduce its dependence on steel by using more carbon fibre materials, which are lighter and very strong, but expensive.

"It is difficult to imagine in the near term production of a series of autos without steel," Berkenhagen said.

German rival BMW has already invested 100 million dollars (78 million euros) in a carbon fibre factory and hopes to produce a small vehicle using the material by 2015.

Meanwhile, Berkenhagen said it was also becoming more difficult to obtain semi-conductors because suppliers had cut production capacity amid the global economic crisis

© 2010 AFP

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