Audi is working on a small sports car called the R4, a car that will challenge the Porsche Boxster and will be launched in 2010. If will be made, Audi will invade the territory owned by Porsche, which now has a near-controlling interest in the Volkswagen group.

The Audi's supercar R8 is a a current example of Audi pushing into Porsche territory. When it goes on sale in the spring, the R8 will compete against the Porsche 911. Audi plans to build 4,000 units of the €104,000 R8. Through 11 months, Porsche sold 18,889 911s in Europe.

The R4 is expected to have a much higher sales target – at least 30,000 a year.

The R4 will arrive in showrooms in 2010 as a mid-engine, two-seat sports car. Seat, VW group's Spanish brand, also could receive a similar vehicle, a separate source said.