Bayerische Motoren Werke AG, the world’s biggest manufacturer of luxury vehicles, expanded its lead over Volkswagen AG’s Audi, buoyed by demand for the X3 sport-utility vehicle.

Sales at BMW’s namesake brand rose 9.3 percent to 128,446 vehicles in September as deliveries of the X3 more than tripled, the Munich-based automaker said today in a statement. Audi posted a 17 percent gain, delivering 120,200 autos on stronger demand in China, the Ingolstadt, Germany-based company said.

“It’s all holding up extremely well,” said Arndt Ellinghorst, an analyst with Credit Suisse in London. The growth rates of about 20 percent that BMW and Audi posted in China are “quite healthy.”

BMW, Audi, and Daimler AG’s Mercedes-Benz are targeting record sales this year and anticipate demand for high-end vehicles to outpace the broader auto market in the coming years, reported Bloomberg. European investor confidence fell to the lowest in more than two years this month on concern that the region’s debt crisis and weaker growth in emerging markets will hurt economic expansion.

“We made solid gains across the globe and once again achieved record sales for September,” Ian Robertson, BMW’s sales chief, said in the statement. The company is “on course” to meet its target of delivering 1.6 million vehicles this year and aims to maintain an “upward trend” in the fourth quarter, he said.

BMW rose as much as 3.7 percent to 52.78 euros and was up 3.6 percent at 4:16 p.m. in Frankfurt. The stock has fallen 10 percent this year, valuing the company at 33.8 billion euros. Daimler gained 3.8 percent to 35.28 euros and Volkswagen jumped 4.8 percent to 106.30 euros.

Audi aims to sell more than 300,000 vehicles in China for the first time after already surpassing last year’s total, Peter Schwarzenbauer, Audi’s sales chief, said in the statement. The carmaker also increased deliveries in debt-strapped countries such as Italy and Spain, helped by the A6 sedan and A1 subcompact, the company said.

“Growth is being driven above all by the emerging markets, primarily from China, but also from Brazil, Russia, India and Turkey,” said Marc-Rene Tonn, a Hamburg-based analyst with Warburg Research, who recommends buying Daimler and Volkswagen shares, and has a “hold” rating on BMW. “The question is how the sales values hold up there.”

BMW expanded its lead over Audi and Mercedes after the first nine months of 2011, delivering 1.02 million vehicles compared with Audi’s 973,200 and Mercedes’s 919,288. The Daimler unit, which aims to overtake Audi and BMW by 2020, remained in third place after sales last month edged up 2 percent to 120,982 cars and SUVs, the Stuttgart, Germany-based company said Oct. 5.

“It’s probably not going to get much better for Mercedes before 2013,” said Ellinghorst. Consumers are looking to trade down to smaller vehicles, a “weak” area for Mercedes, he said.

Mercedes’ best-selling C-Class will also face tougher competition next year, as BMW prepares to introduce a revamped version of the 3-Series sedan.

Volkswagen AG’s Audi, the luxury brand trying to double its U.S. sales, has lowered the sticker price of its redesigned A6 midsize sedan to grab more market share.

The new A6, now in its first full month of sales, starts at $41,700, the company said on its website, down from $45,200 for the previous model. Bayerische Motoren Werke AG’s 5-Series line, which outsells the A6 almost fivefold in the U.S., starts at $45,050, and Daimler AG’s Mercedes-Benz E-Class sedans start at $49,400 and outsell the Audi model almost 6-to-1, according to Bloomberg.

Volkswagen aims to double luxury sales in the U.S. to 200,000 — in league with BMW, Mercedes and Toyota Motor Corp.’s Lexus — by 2018 as part of its plan to become the world’s biggest automaker. While the compact A4 cars and Q5 sport- utility vehicle accounts for half of Audi’s U.S. sales, boosting sales volume for the A6 will increase exposure of the brand to influential consumers beyond its full-size A8 and stretched A8L.

“People observe what these wealthy and discerning individuals drive,” Johan de Nysschen, head of Audi in the U.S., said in an interview. “It’s an important part of the brand development.”

While Audi sells fewer vehicles than the top luxury brands, it has narrowed the gap. Five years ago, Audi deliveries totaled 90,116 cars and SUVs in the U.S., while the other three brands sold 247,973 to 322,434.

BMW, poised to become the top-selling luxury auto brand in the U.S. this year, and Mercedes “are vastly outperforming” Audi in the midsize segment, said Tom Libby, an auto-sales analyst with Woodcliff Lake, New Jersey-based R.L. Polk & Co.

Audi sold 8,006 A6 sedans in the U.S. last year, trailing the 38,700 5-Series and 46,900 E-Class sedans sold. Sales of the outgoing Audi model, last redesigned in 2005, have increased 0.9 percent through July, while deliveries of E-Class sedans rose 8.4 percent and 5-Series sales jumped 65 percent.

“If they want to get to their goal of being the No. 1 premium brand, if they want to get to the goal of 200,000 units in the United States, obviously they need to improve in that segment,” Libby said.

Audi accounts for a quarter of U.S. sales by Volkswagen, which aims to be the world’s biggest and most-profitable automaker by 2018. Last year, VW ranked third, about 1.2 million deliveries behind Toyota and General Motors Co. Through the first half, it trails GM by about 400,000 sales and leads Toyota by about the same amount.

The lower sticker price on the new base A6 means the automaker shouldn’t have to rely on subsidized lease offers to lower payments. Selling without big discounts will improve impressions of the brand and model over time, said Polk’s Libby.

“You can’t keep being a quote-unquote deal product and expect to establish yourself in those upper price-range segments,” he said. “You need to reposition and slowly rebuild it.”

Audi’s efforts to become more premium have raised the average transaction price of its brand by $5,000 over the past three years and taken new customers from competitors, de Nysschen said.

The new car, which can come with features such as night- vision assist and a mobile Wi-Fi hot spot, is winning praise from critics.

“The A6 blends everything together into a symphony of driving fun,” wrote Scott Burgess of the Detroit News. “This A6 will make many trips more interesting than the actual destinations.”

Audi’s integration of technology, including self-parking and the Google Earth mapping system programmed into the navigation screen, may help it attract luxury customers who often want the latest gadgets, said Jeremy Anwyl, head of Edmunds.com, a Santa Monica-California-based website that tracks auto sales.

“Nobody needs to spend that kind of money on a vehicle,” he said. “They’re doing so because they want to. A lot of it is a statement. From the technology standpoint, it’s the cool factor.”

Sales of the previous A6 were improving as the brand set a U.S. record last year, said Joel Weinberger, who owns an Audi dealership in Naperville, Illinois, west of Chicago.

The new “A6 is going to continue to ride that wave and be able to expand that market,” he said. “It’s a 5-Series and E- Class fighter.”

The A6 along with the larger A7 and A8 sedans and Q7 SUV are part of an effort to woo more wealthy customers. By next year, de Nysschen said he wants those models to consistently account for 30 percent of deliveries, up from 18 percent last year. While Audi has reached that mix in some months when supply of A4 compact cars has been limited, he aims for more sales of all models.

U.S. sales of the redesigned A8, introduced last year, rose to 3,300 through July from 473 a year earlier. The new A7, which went on sale in April, has already sold 2,701 this year.

“The A6, of course, is an extremely important part of our strategy to raise the center of gravity of the brand moving forward,” de Nysschen said.

Audi has taken 850 dealer employees to Germany for training and 1,000 more have attended special sessions in the U.S., he said. Over the next 18 months, an additional 4,000 people will go through the program, which includes customer service and hospitality training.

“It’s an area that I think is especially important as we seek to expand the number of these high-end and discerning and obviously demanding customers,” he said. “They arrive with a different expectation set perhaps than what our dealers have been accustomed to in the past and we need to respond to this.”

It was a lackluster dealer experience that nudged Ryan Waid into a BMW 5-Series instead of an Audi.

“The service at the BMW store has been fantastic,” he said. “That’s one of the reasons why even if I really consider Audi it would be hard for me to leave BMW.”

Still, he’s willing to give Audi a try. His three-year lease ends next year and he’s interested in the A6 because of its more aggressive exterior look, said Waid, 37, a lawyer who lives in Harrisonburg, Virginia.

“I’ve been impressed by the reviews I’ve read.”

Bayerische Motoren Werke AG, the world’s largest maker of luxury vehicles, earned record per-car profit in the second quarter as demand for the 5-Series sedan helped it beat Volkswagen AG’s Audi.

BMW generated the highest profit margin of the top three luxury-car makers, with its auto unit posting earnings before interest and taxes equivalent to 14.4 percent of sales, up from 9.6 percent a year earlier. That beat margins of 11.8 percent at Audi and 10.7 percent at Daimler AG’s Mercedes-Benz, according to Bloomberg.

“For an analyst who’s covered BMW for 11 years it’s amazing to see this level of earnings,” said Max Warburton, a London-based Sanford C. Bernstein analyst with an “outperform” rating on the stock. “At no point in the past would it have been imaginable that this company could make margins of this level.”

Demand for the revamped 5-Series sedan and X3 sport-utility vehicle helped the maker of BMW, Mini, and Rolls-Royce models keep its high-end segment lead. Deliveries this year of the $45,050 5-Series have jumped 80 percent and the $36,750 X3 has more than doubled, fueling an 18 percent rise in the BMW brand’s first-half deliveries. Audi, which passed Mercedes this year and aims to topple BMW by 2015, also boosted sales 18 percent.

BMW closed down 1.92 euros, or 2.8 percent, at 65.79 euros, after gaining as much as 2.4 percent in Frankfurt trading earlier in the day. The stock has risen 12 percent this year, valuing the company at 42 billion euros ($60 billion). VW is up 9 percent in 2011, while Daimler has dropped 6.5 percent.

BMW’s second-quarter Ebit climbed 66 percent to 2.86 billion euros, the Munich-based carmaker said today. Profit beat the 2.3 billion-euro average estimate of 17 analysts surveyed by Bloomberg.

“This is not a one-time event for BMW,” said Arndt Ellinghorst, a London-based Credit Suisse analyst with an “outperform” rating on the shares. “They have the strongest product lineup and best execution in the market.”

Germany’s luxury-car makers are ramping up production to satisfy growing demand in China and rebounding spending in the U.S. Mercedes is building a factory in Hungary and expanding a plant in Alabama, while Audi has added production in Spain.

BMW will expand a South Carolina factory to 300,000 vehicles next year from 270,000 in 2011, and will likely decide in favor of building a new facility to assemble vehicles in Brazil from parts produced at other plants, Chief Executive Officer Norbert Reithofer said today.

“We are producing at the limit” and the waits for some models like the X3 are “too long,” said Reithofer.

Second-quarter net income more than doubled to 1.81 billion euros from 834 million euros as revenue gained 17 percent to 17.9 billion euros. Earnings were boosted by 464 million euros in one-time gains from releasing risk provisions. Excluding the one-time gains, BMW generated an auto margin of 13.9 percent.

BMW raised its 2011 profit and sales forecasts on July 12, citing strong demand for its vehicles. The company today said that ebit at its auto division will exceed 10 percent of revenue in 2011, excluding one-time effects. Sales are projected to rise to more than 1.6 million vehicles.

“From today’s perspective, it seems unlikely that we will be able to maintain the high ebit margin of the second quarter through the rest of the year,” Chief Financial Officer Friedrich Eichiner said.

The increase in deliveries declined to about 7 percent in July and growth will likely be slower overall in the second half because of lineup changes and higher deliveries a year earlier, the carmaker said.

“Global risks continue to increase rather than decrease,” said Reithofer. “Concerted action of the international community is required to be able to maintain economic and financial strength worldwide.”

BMW will introduce an overhauled version of the 1-Series compact in September in a bid to outsell Audi’s A3. Model introductions will add about 500 million euros to expenses in the final six months of 2011, while higher raw material prices will increase costs by more than 100 million euros, Eichiner said. The company is targeting margins in a range of 8 percent to 10 percent on average after this year.

“BMW’s margins have peaked,” said Juergen Pieper, a Frankfurt-based analyst with Bankhaus Metzler who has a “sell” rating on the stock. “The best phase of the cycle is behind it, as the product mix will start deteriorating with the 1-Series.”

INGOLSTADT – Volkswagen AG’s Audi division aims to continue expanding even if it achieves its goal of selling 1.5 million cars a year by 2015 and becoming the world’s No. 1 luxury brand.

“Of course we don’t want to stop there,” Audi CEO Rupert Stadler told Automotive News Europe Executive Edition in an interview to be published Tuesday, February 22, reported Automotive News Europe.

Stadler said Audi has other key targets as part of its strategic roadmap. “Profitability is one of them but not the only important one. Customer satisfaction and quality are other important goals. We want to become the most successful premium brand and this means that all these targets have to be ‘premium,” Stadler said.

Audi urgently needs more production capacity within the next four years to reach the sales goals. Stadler said. “In Hungary we will add an additional capacity of 125.000 units as of 2013. This year the Audi Q3 has its run up in Martorell in Spain with a maximum capacity of 100.000. And we will make a decision on an U.S. facility until 2015.”

Stadler said China will be Audi’s top market with Germany as number two and volume increasing in the United States. “I think that our volume in the U.S. market can grow 50 percent over the next five years and that we can reach 200.000 units per year after 2015.”

The UK will be Audi’s fourth-largest market, followed by Italy at number five, Stadler said.

Bayerische Motoren Werke AG, Daimler AG and Audi AG, the world’s three largest makers of luxury cars, forecast record sales this year driven by China and the U.S.

BMW, the maker of Mini and Rolls-Royce models, said today deliveries will increase beyond 1.5 million units this year from 1.46 million in 2010. Volkswagen AG’s Audi unit is aiming to deliver 1.2 million cars and sport-utility vehicles up from 1.09 million. Daimler AG’s Mercedes-Benz division expects record sales after delivering 1.17 million vehicles.

“We’re looking forward to a very upbeat year in 2011,” Audi Chief Executive Officer Rupert Stadler said at the Detroit auto show. “It is programmed to growth.”

Demand for luxury cars including BMW’s 5-Series, Mercedes’ top-of-the-line S-Class and Audi’s A8 flagship sedan is swinging back from the global recession, a rebound in the U.S. and the fastest growth since reunification in 1990 in Germany, the three manufacturers’ home-market, reported Bloomberg.

Sales in 2011 will be “defined by production capabilities rather than demand,” Daimler CEO Dieter Zetsche said at the show. “That’s a good problem to have.”

Munich-based BMW, which premiered the 6-Series convertible in Detroit and the M1, the first high-performance version of its 1-Series compact, is targeting 2 million sales by 2020. Mercedes is presenting a diesel S-Class, its fifth U.S. diesel model while Audi is rolling out an updated A6 sedan at the show.

“Customers are willing to spend again,” said Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences in Bergisch-Gladbach, Germany. “The momentum in the luxury segment is gaining ground, there’s no denying about that.”

Porsche AG, the German maker of the 911 sports car, said orders jumped 49 percent to a record 114,000 vehicles last year. The manufacturer expects to sell more than 100,000 vehicles this year after delivering 97,000 units in 2010, according to Chief Executive Officer Matthias Mueller.

“We’re entering the new year with considerable confidence,” Mueller said at a Detroit presentation.

The story of Audi momentum in the U.S. market doesn’t live only with the brand’s consistently strong new-vehicle sales results, which are on track to set a full-year record in 2010. Audi Certified Pre-Owned sales are also benefiting from strong consumer demand and established a new sales record for July.

In the recently concluded month, sales of Audi Certified Pre-Owned vehicles reached 2,766 vehicles. That represented a 9.7 percent improvement over year-earlier sales results of 2,521 vehicles and it topped the previous July Certified Pre-Owned sales record set in July 2008.

Particularly strong Audi Certified Pre-Owned sellers in July 2010 were the Audi Q7, which increased 243.7 percent; the Audi A3, which increased 108.1 percent, and the Audi TT, which increased 86.2 percent.

Audi is waiving the first monthly payment on Audi Certified Pre-Owned vehicles purchased through September 6th and financed through Audi Financial Services as part of the Summer of Audi Event. In July, the first payment offer proved popular among customers and helped drive the record sales result. Financing offers as low as 0.9% APR will also continue through September 6th.

The Audi Certified Pre-Owned program puts previously owned Audi models through a 300+ Point Inspection process before releasing them for sales. It further backs up the pre-owned Audi cars and SUVs with:

• 24/7 Roadside Assistance for the duration of the warranty, including trip interruption benefits;
• the balance of the original 12-year Corrosion Perforation Limited Warranty, regardless of mileage;
• the balance of no-charge scheduled maintenance;
• 24-hr customer service support;
• only vehicles with an approved CARFAX Report are considered for the Audi Certified pre-owned program;
• a factory-backed limited warranty with coverage for up to six years or 100,000 total vehicle miles.