FRANKFURT, Germany – AUDI AG saw 2009 net income fall 39 per cent to ¤1.35 billion ($1.8 billion) as the economic downturn cut demand for its cars, the German automaker said yesterday.

Audi, based in Ingolstadt, earned ¤2.2 billion in 2008. The company did not break out fourth-quarter figures.

Audi said revenue fell 13 per cent to nearly ¤30 billion from ¤34.2 billion in 2008. Total vehicle production fell 9.4 per cent to 932,260 cars in 2009 from just over one million in 2008.

Audi is a unit of Europe’s largest carmaker Volkswagen AG.

Audi said despite an expected slight increase in demand for cars in 2010, the European market will stagnate or deteriorate further. However, the company should see gains from the emerging markets of India and its most important foreign market, China, it said.

Audi said it “should succeed in restoring the pattern of growth seen in recent years as early as 2010.”

Audi said it will boost its deliveries as well as revenue in 2010 and 2011. With productivity improvements and strict cost management, the company should also see an improvement in operating profit, Audi said in its report.

“Systematic renewal and expansion of the product portfolio remain an exceptionally important aspect,” the company said. As a result, Audi said it will soon launch its first premium vehicle in the small-car class called the Audi A1, and that the overall model range will expand.

German revenue fell eight per cent in 2009 to nearly ¤9 billion for Audi, while the rest of Europe saw revenue fall 21 per cent to ¤13.2 billion. Europe benefited from government programmes during the downturn in which new car sales were subsidised. Those programmes are set to end this year or already have finished.

The Asia-Pacific region posted a 12 per cent increase in revenue to nearly ¤5 billion, with Chinese sales in particular helping the brand.

Africa posted a small gain in revenue, while North America and South America reported declines in revenue for 2009.

Earlier this week Audi said global February unit sales increased 20 per cent on the year, and that it is on track for a strong first quarter.

The company said it saw a 62 per cent increase in sales in China and a 34 per cent increase in the US during February. Western Europe also reported an improvement in February unit sales from year-ago levels.

Shares of Audi were about one per cent higher at € 577 in Frankfurt morning trading yesterday.