Audi - in the middle of a 17-model product programme says it plans to cut spending on purchasing, manufacturing and development as it looks to make savings of EUR2bn (US$2.5bn) a year.
The company wants to protect its profit margins as spending increases on new technology including electric cars, in-car communications and autonomous driving while also expanding production capacity.
Bloomberg News, quoting unnamed sources, said the savings were outlined in the summer by Audi CEO, Rupert Stadler, in a letter to employees.
Audi has a EUR22bn investment budget for the next five years with almost three-quarters of that earmarked for new products and technology.
It is also spending on new factories in Brazil and Mexico.
Audi will sell a record 1.7m cars this year and is the biggest earnings contributor to parent company Volkswagen.
Bloomberg noted operating profit during the last six months has been around 10% of sales.