Audi Wants To Be World's Leading Premium Brand

Bertel Schmitt
by Bertel Schmitt
audi wants to be world s leading premium brand
When I did my first work for Audi in the 70s, competing with BMW or (gasp) Mercedes-Benz was considered a cruel joke. The brand was thought ideal for high school teachers or tax collectors, who kept their hats on while driving. What a difference a few decades make. Not to forget the money a rich sugar daddy called Volkswagen can sink into the brand.Audi CFO Axel Strotbek told the German Handelsblatt that VW will pour €7.3b into Audi, from now to 2012. “80 percent is earmarked for developing new product,” Strotbek said. The money will go to a noble cause:By 2015, Audi wants to be the world’s leading premium brand. That target is not overly ambitious, but ambitious nonetheless. In 2008, Audi sold slightly above 1m units, Mercedes sold 1.3m, and BMW 1.4m.This year was harsh on anything that has “Premium” attached to it. But Audi seems to weather the storm better than the competition. Audi will close out the year over target (925000 units.) Audi wants to have a gross profit margin of more than 5r percent of revenue this year. Daimler will probably be in the reds, BMW will be lucky with a big black zero. Audi profits from its solid standing in China’s booming market. This year, they will sell 150,000 Audis in China, 2012/13 they want to raise that to 250,000 units. This will make China Audi’s most important market. Different in the U.S.A. Here, BMW and Mercedes sell three times the volume of Audi.
Join the conversation
4 of 34 comments
  • WildBill WildBill on Dec 21, 2009

    I hope the Audi is better now than they were. Do see a lot of them around Central Ohio. I agreed, in a brain-dead moment, to sell my MIL's Fox for her. It would actually fall apart just sitting. Something that worked fine on one test drive would have broken, failed, fallen off or fallen apart the next time it was driven. Did eventually find a sucker to take it. Never was so glad to get that green POS out of my yard!

  • Davekaybsc Davekaybsc on Dec 21, 2009

    Audi sells a lot of FWD cars in the rest of the world, but you will struggle to find an Audi in the US that doesn't have Quattro. The FWD thing is really a non-issue, as is the "gussied up VW" stereotype. As has already been stated, only Audi's smallest cars use the Golf platform and VW drivetrains. I'm not really a fan of the A3 and TT for that reason. If it's using a transverse engine and 4Motion AWD, it's not really an Audi as far as I'm concerned. Audi has been working on fixing the excessive understeer of their cars since the last RS4, and it's paying off. Even the regular cars now get the 40/60 front/rear torque split, the old over-the-nose engines have been pushed back into more of a front-midship arrangement for better weight distribution, and the new QuattroSport rear-dif even allows you to get the back end out if you want to. If you think the M3 is good, just wait and see what the upcoming RS4/RS5 will be able to do. 4Matic and xDrive are utter crap compared to real torsen Quattro with the new active rear diff. Only the system used in the X5/X6M comes close, but it still isn't as good. The US luxury market is completely saturated, and also badge obsessed. That's the only reason M-B has been able to sell so many C-classes, despite that car being basically terrible. Audi will have to pry sales away from Lexus and BMW, and it won't be easy. Audi is already the #1 premium brand in Germany and they far outsell BMW and Mercedes in China. Lexus is a complete joke on the world stage. Even the Japanese don't want them. From what I've been hearing, their quality improved dramatically starting around 2005. In the latest VDS report, they are about even with Porsche and *gasp* Honda. BMW didn't do as well, and Mercedes was nowhere near. The one thing I definitely agree with is that Audi should offer far more color/trim options than they do. The UK market A6 gets loads of wheel options, seat options, and leather and wood combinations. We get practically nothing.

  • Donovan Colbert Donovan Colbert on Dec 22, 2009

    The thing that turns me off about Audi is the edgy, urban, ricer interior trim details. Both Audi and VW seem to fall victim to this urge to add some graphite composite, some brushed aluminum, a shiny chrome shift nob - which certainly appeals to the 20-somethings and early 30-somethings still trying to hold onto their 20s. For me, I prefer something a little more refined and elegant. Heck, even "German Spartan" is preferable to chrome and metal ricer bling. The LED angel eyes that Audi is flaunting throughout their line-up is a great example of this down-marketing trend to appeal to affluent young men. I was recently "buried" badly on Digg for saying that I think the Audi headlight treatment is ugly. Thing is, Digg is full of twenty-something college students who can't afford a new Audi, so it doesn't matter if they think the car looks cool or not, most of them can't afford it. I can, and so can many of my peers. But I don't see how they'll ever meet their market targets if they're not figuring out how to court the 35-55 segment of automotive buyers. The interior of the typical Audi looks more like the interior of a loaded WRX than of a typical Bimmer.

  • Tricky Dicky Tricky Dicky on Jan 08, 2010

    @Psarhjinian: :-O (genuine shock) The reason for the Europe/North America disparity is fourfold: 1. Europeans will put up with much more crap than North Americans will. What’s normal for a European car owner wouldn’t be tolerated here - it's amazing you can say this. Haven't the D3 operated the business model for years of selling vehicles with built-in obsolescence and shitty interiors? As long as it has 500 ponies under the hood it's good enough for the rednecks?! It seems to me that many American autos over the last 20 years are the very essence of crapness and that the D3 have been completely unable to persuade (despite lots of failed attempts), to get Europeans to buy. Or to use your words, Europeans won't put up with that kind of crap?! Maybe you meant something different? 2. Europeans drive less and are less dependent on their cars. (True) Getting stranded or not being able to start, or waiting for parts is a lot less of an issue It is if you were planning to use the car - Europeans don't say, "Oh well, no worries, I'll just get the train instead". The rant and rave and jump up and down and get sweary. Public transport maybe an option in a city, but the fact that vehicle penetration rates are still very high across Europe shows that cars are still very much a requirement for convenience and cost alot of the time. So quality and reliability is still very important. If you've broken down next to the highway, you can't stick out your thumb and expect a train to stop to pick you up...