AUTO INSURANCE ARTICLE

Lamborghini 2008 profit up 27% on cost-cutting

By: AutoInsuranceGuy

MILAN (Reuters) -- Lamborghini's drive to cut costs helped it post a 27.4 percent rise in pretax profit on virtually flat sales in 2008. The luxury sports car maker aims to post another profit this year despite the global economic crisis.

"The target for the 2009 financial year is to attain an overall profit," Lamborghini said in a statement on Wednesday without giving a specific forecast.

CEO Stephan Winkelmann said he expected sales to decline this year but not as much as those for the luxury car market in general, as wealthy car lovers postpone making big purchases.

"I'm sure the market will remain like this," Winkelmann said.

Aston Martin CEO Ulrich Bez was quoted by German daily Die Welt last month as saying he expected his company to sell fewer cars this year after having enjoyed the second-best year in its history in 2008.

Winkelmann said Lamborghini is prepared to wait if it takes time for the market to pick up again.

"We are ready for 2009 and 2010 to have no growth," Winkelmann said.

Lamborghini, based in Sant'Agata Bolognese, Italy, has been sending a third of its staff home during temporary shutdowns of its plant there, but Winkelmann said the company had no plans to make permanent job cuts.

The company also would not touch its budget for developing a new car every year, he said.

The latest model, the Murcielago LP 670-4 SuperVeloce, was shown at the Geneva auto show in March. A third of the limited run of 350 units has already been sold.

Although 2008 was a record year for unit sales, Lamborghini still missed its target. Unit sales went up only 1 percent to 2,430 units, far below the 5 percent target.

Revenue rose 2.5 percent to 479 million euros, with strong growth in Asia and the Middle East helping to offset the sharp drop in the United States, Lamborghini's single biggest market.

Pretax profit was 60 million euros, helping Lamborghini meet at least one target for the year -- a return on sales of 12.5 percent against 10.1 percent the prior year.