Hey, Wait Up: Audi Crafts Realignment Plan After German Rivals Spring Ahead

Steph Willems
by Steph Willems

Audi’s global sales fell 3.5 percent in 2018, placing the Volkswagen Group brand further behind in its bid to challenge the likes of Mercedes-Benz and BMW. As its revenue dipped, so too did the brand’s operating margin.

Mistakes were made, the automaker claims.

As it gears up to present a strategic realignment plan on May 23rd, Audi’s echoing Ford in claiming 2019 will be a “transition” year.

Audi’s biggest mistake was not planning for the European Union’s new WLTP testing cycle, which led to a severe drop-off in deliveries in 2018. European sales sank 14 percent. The brand’s return on sales fell to 6 percent, down from 7.8 percent the year before.

“We cannot be satisfied with our performance. Audi has excellent products on the market, but in business terms, we failed the WLTP changeover as the ultimate stress test,” says Board of Management Chairman Bram Schot in a statement.

Investment in electric vehicle development and lingering costs from the diesel scandal further hurt the brand’s financial standing. The solution? In addition to the streamlining and targeted investments seen in the brand’s Transformation Plan, more high-end vehicles appears to be the key.

Audi puts the pedal down on its future proofing efforts on May 23rd with the release of its realignment strategy.

“We are significantly accelerating the change, because we have to master a double transformation,” sid Schot. “We will be much more customer-oriented and less self-centered; we will focus on what is decisive and implement what is decided upon in a very consistent and disciplined manner.”

In the coming years, Audi promises further “bundling of platforms and vehicle architectures,” increased speed and efficiency across all divisions, and a boost in high-margin vehicle production. Like its rivals, Audi knows EVs don’t pay for themselves. A smattering of new, pricey SUVs and crossovers can help generate the cash needed for R&D.

“By 2025, the product range in the upper mid-range and full-size segment will have grown to 15 models,” the automaker stated.

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[Image: Audi AG]

Steph Willems
Steph Willems

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  • Inside Looking Out Inside Looking Out on Mar 14, 2019

    "Audi’s echoing Ford in claiming 2019 will be a “transition” year." Yeah, but they do not have such a genius as Hackett.

  • Fred Fred on Mar 16, 2019

    What I read is that the bottom line is more SUVs. Seems to be the answer for every car maker these days.

  • SCE to AUX What a boondoggle.I'd rather have 40 sandwich shops opened to hire those 200 workers, and it wouldn't cost $300 million. They could include chips with every meal."The company is targeting 4.2 GWh worth of lithium-ion battery packs annually by 2026."For reference, Tesla's Gigafactory One has been at over 37 GWh annually for years, not counting its energy modules (another 14 GWh).https://www.tesla.com/blog/continuing-our-investment-nevada
  • JMII Checking Cars-N-Bids the price of Rivians has dropped significantly. These things went from 100k down to 60k on the used market. I assumed it was because they finally shipped enough units as I've seen a few on the roads around me.I had a guy at the local boat ramp asked if I liked my Rivian. I told him what I was driving was in fact a Hyundai Santa Cruz. To me which he asked how I liked my EV. I responded, nope this is a turbo 4. He looked very confused - granted it was dark 'o clock in the morning so maybe his coffee hadn't kicked in yet because a Rivian and SC look very different. Both have a futuristic lighting setup so maybe that is why (again it was dark).
  • Lou_BC ****Cracked engine blocks 2.7 litre turbo 4 banger. *****"GM has issued a new Customer Satisfaction Program. The Customer Satisfaction Program was released in February of 2024 and is tagged as N232415060, Block Main Oil Gallery Hot Core Pin Casting Defect. This particular Customer Satisfaction Program only applies to units of the Chevy Silverado 1500 produced for the 2023 model year. It’s currently unclear exactly how many units are affected, however, the Customer Satisfaction Program also applies to units of the 2023 Chevy Colorado, as GM Authority covered previously."
  • Duke Woolworth The advantage of EVs is the luxurious quiet, even in the cheapest/smallest ones. Passengers can speak in normal volume, and the quiet is less stressful. And no oil changes.
  • Akear They may sell 3500 annually. After a few years it will be gone. Why would anyone in their right mind purchase this over a Prius.