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Old 4th September 2015, 10:28   #1
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Default Audi to increase investment in India, ramp up manufacturing

Audi is gearing up to announce a fresh investment in India. This investment will be used to enhance its manufacturing set-up in the country. The company has not disclosed the amount it plans to invest.

Audi to increase investment in India, ramp up manufacturing-audi-a8.jpg

In 2013, Audi overtook BMW to become the most popular luxury car brand in India. It also became the first luxury carmaker to sell more than 10,000 units (10,002) in a calendar year. In 2014, with sales of 10,851 units, the company retained the first position. However, arch rival Mercedes-Benz, with sales of 10,201 units, had closed the gap significantly. In the first half of 2015, Mercedes-Benz had sold 6,659 units, reflecting a growth of 41%, and taken the lead. Audi still believes it can finish ahead of Mercedes-Benz at the end of the year. The company expects to retain the 34% market share that it achieved in 2014.

The luxury car market accounts for just 1% of the overall passenger car market. Last year, the total number of luxury cars sold stood at around 33,000 units. With the increase in disposable income and easier finance schemes, this share is expected to go up.

Audi cars are assembled at the Skoda factory in Aurangabad. The company can produce 14,000 units on an annual basis, working on a single shift. Audi has invested around 30 million euros (Rs. 220 crore) till now.

Source: Times of India

Last edited by Aditya : 4th September 2015 at 12:35.
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Old 4th September 2015, 10:58   #2
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Default Re: Audi to increase investment in India, ramp up manufacturing

Audi still has the scope to introduce more cars and increase the sales.
One idea: Introduce a punchy hatchback at about 20L, and the sales will increase. When Merc (A, B class) and BMW (1 series) have their hatchbacks, Audi can also plan a nice hatchback for India.
If the price range is about 15-20L, even the customers for S-Cross / Creta will also think about rewarding themselves an Audi!
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Old 4th September 2015, 11:46   #3
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Default Re: Audi to increase investment in India, ramp up manufacturing

Quote:
Originally Posted by hybridpetrol View Post
If the price range is about 15-20L, even the customers for S-Cross / Creta will also think about rewarding themselves an Audi!
If Audi launches at 15-20L price range, they will lose their Brand value.
Something they can't afford to do it.
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Old 4th September 2015, 11:51   #4
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Default Re: Audi to increase investment in India, ramp up manufacturing

Audi will stay away from mass market products. They get fat margin because of exclusivity of the products offered by them and the their customers are ready to pay to Audi to continue with exclusivity.

The moment Audi breaks into mass market (say sub 20 L price band), the existing customer base will also break away from them.

They will continue to manage the show with innovative ownership schemes through financing, pre-owned products but not through price war among the 3 German giants.

One has to arrive in life to have these German machines and there are no short cuts to it.

Cheers

Last edited by i74js : 4th September 2015 at 11:53.
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Old 4th September 2015, 12:41   #5
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Default Re: Audi to increase investment in India, ramp up manufacturing

Quote:
Originally Posted by chaith.turbo View Post
If Audi launches at 15-20L price range, they will lose their Brand value.
I don't agree with that. There was huge debate in the Audi, BMW & Mercedes boardrooms when they wanted to enter segments below the A4, 3-Series & C-Class. In fact, there were many who opposed Mercedes' decision to go below the E-Class in the eighties (with the 190E....then the C-Class).

Their brand value surely hasn't gotten affected. Mercedes builds trucks & buses - it's still the most revered luxury brand.

In fact, I'll go a step further and tell you what will affect their brand:

- Poorly equipped variants (no leather seats or sunroof at 30 lakhs )

- Unreliable mechanicals

- Shoddy / arrogant sales & service experiences

All three German brands indulge in one or more of these 3 factors. That's what will really affect their brand equity.

Quote:
Originally Posted by i74js View Post
Audi will stay away from mass market products.
VW will never let them compete in the mass segment as that is VW's domain.

Though, nothing is stopping Audi from launching smaller, premium products (at the same price as larger VW cars). Audi A3 <-> VW Jetta and Mini Cooper <-> BMW 3-Series are two examples.
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Old 4th September 2015, 14:25   #6
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Default Re: Audi to increase investment in India, ramp up manufacturing

Quote:
Originally Posted by GTO View Post
- Poorly equipped variants (no leather seats or sunroof at 30 lakhs )

- Unreliable mechanicals

- Shoddy / arrogant sales & service experiences

All three German brands indulge in one or more of these 3 factors. That's what will really affect their brand equity.
I agree these areas will also affect their brand equity.

However, a Brand name is a mindset, If there are as many Audis on road as Hyundai, The brand value is definitely lost. This logic is definitely applicable for Indian market.
I know few people who didn't buy Volvo but went for one of the Big 3, simply because Volvo's name is more attached to BMTC buses in Bangalore.
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Old 4th September 2015, 16:05   #7
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Default Re: Audi to increase investment in India, ramp up manufacturing

Quote:
Originally Posted by GTO View Post
In fact, I'll go a step further and tell you what will affect their brand:

- Poorly equipped variants (no leather seats or sunroof at 30 lakhs )

- Unreliable mechanicals

- Shoddy / arrogant sales & service experiences

All three German brands indulge in one or more of these 3 factors. That's what will really affect their brand equity.
Even though I am not an Audi customer I will be happy to cheer for them for increasing investments into India. God alone knows we need more investment into our manufacturing sector to create a diversified demand for jobs. Good for Audi. If the German 3 wish to go much further then the three lacunae GTO points out need to be addressed or someone else will and thus fill the gap. On a lighter note when we were looking for a car 9 months ago my wife (who metaphorically speaking cannot tell a Maruti from a Mercedes) said no to the Audi A6 because she thought it was too common because holy cow she could recognize it. That's a backhanded compliment for Audi's timeless looks.
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