Audi accelerates localization push with Chinese partner SAIC Motor

Luxury brand deciding which of its models to manufacture at Chinese base

Volkswagen's premium arm Audi is in the process of deciding which of its models will be manufactured locally with its second Chinese partner SAIC Motor, and the final picks are to emerge within months, according to brand's China chief.

Audi and SAIC Motor have been carrying out feasibility studies for models to be produced at SAIC Volkswagen, said Audi China President Joachim Wedler in an interview on Friday.

The whole SAIC-Audi project is going forward as planned, he said.

"Currently we are focusing on model planning. Planning on production and the sales network will come afterwards," Wedler said.

Cars from SAIC Volkswagen will not hit the market until 2022, according to a deal reached with Audi's first Chinese partner, FAW Group.

Wedler said the SAIC-Audi project will be one of the major driving forces of its mid-term development in China－a market where the premium brand has been the sales champion for 30 years in a row.

Compared with secrecy around its more recent partnership, Audi has developed a much clearer roadmap with FAW and together they are localizing the production of six Audi models in the country.

"Audi is celebrating its 30th anniversary in China this year," Wedler said.

"Together with our partner FAW, we plan to more than double our local model portfolio in the next five years."

That would include a number of sport utility vehicles and new energy cars, of which both segments are growing fast in China. Audi is also importing its flagship models as part of its efforts to further exploit the Chinese market.

The first model it has introduced this year is the A8 sedan, which is recognized as one of the most intelligent cars in the premium car segment.

Within the year, the A8 sedan is to be joined by the A7 sedan, the Q8 SUV and the e-tron electric SUV.

Wedler said Audi has also chosen China for the global debut of the Q8 in June.

The German automaker said the models, both localized and imported, will further consolidate its position in China's premium car market, where some 2.5 million cars were sold last year.

With sales of 595,288 cars, demand for Audi models again topped all other premium marques in 2017.

The momentum has continued, with a record number of 154,000 cars sold in the country in the first quarter this year, according to the carmaker.

"We are confident that Audi will continue to be the leader of China's premium car segment in 2018," Wedler said.

Audi is also restructuring its business to prepare itself for future mobility in the world's largest car market.

In March, it signed a memorandum with FAW to establish a sales business and a company specializing in new mobility and digital services.

The carmaker said it expected the sales company to launch large product initiatives with faster decision-making processes.

The new mobility company will enable Audi to respond to Chinese customer requests with even more agility and offer new digitization concepts.

Among other projects, the new mobility company will take over premium mobility service Audi on demand+, which was launched in Beijing in September last year, according to the carmaker.

Both companies are expected to start operation within the year, Audi said.