Audi maps out a torrid sales pace

Inspired by robust demand in the world's No 1 auto market, Audi AG expects to continue to set records by selling 15 percent more vehicles in China this year than the German luxury carmaker did in 2008.

The plan was revealed in a China Daily interview last week with Johannes Thammer, general manager of Audi sales at Sino-German joint venture FAW Volkswagen Automobile Co.

Audi, owned by Volkswagen, moved nearly 120,000 vehicles in China last year, up 17 percent from 2007.

In the first seven months of this year, its sales in the nation surged 14.9 percent over the same period of 2008 to 79,390 units, further consolidating its clear lead in the premium car segment, Thammer said.

"Luxury vehicles still have great growth potential as they only account for 5 percent of overall passenger car sales in China, compared with more than 15 percent in mature markets," he said.

Audi announced earlier that it aims to boost annual China sales to 200,000 vehicles by 2015, when its global sales are projected to reach 1.5 million units a year.

Last week Audi also held a ceremony for the 500,000th locally made A6 sedan.

The carnmaker's most popular model in China, the A6 has been in production for 10 years, yet its numbers continue to register double-digit growth. From January to July this year, sales of the Audi A6 jumped by 12.3 percent to 55,233 units, fully 64 percent of the segment.

"I expect (accumulated) sales of the A6 will hit the 1 million mark in the next five years," Thammer said.

In addition to the A6, the FAW Volkswagen joint venture based in the northeastern city of Changchun is also making the A4 sedan as well as a range of Volkswagen models.

Last week, Audi also launched a diesel-powered A6L 2.7 TDI model in China that retails for 488,800 yuan. Thammer said the TDI will meet a "special demand" from local buyers, although it will not become a major seller in the short term.

The A6L 2.7 TDI produces maximum power of 140 kW and boasts top torque of 380 Nm. It accelerates from zero to 100 km an hour in 8.8 seconds, yet only uses 6.8 liters of diesel per 100 km, 40 to 45 percent less than same-displacement gasoline vehicles. The model also emits 30 percent less CO2 than the comparable gasoline cars.

Audi is the sole maker of diesel-powered luxury cars in China. In 2004, it launched an A6 2.5 TDI locally.

Yet diesel vehicles now account for nearly a zero share of China's passenger car market, mainly due to bad quality and the short supply of diesel. In contrast, diesel vehicles have more than half of the European car market.

The joint venture is also set to begin production at a new 1-billion-yuan, 100,000-unit plant next month to assemble Audi cars that will double its capacity in China to 200,000 vehicles annually, including the Audi Q5 SUV, which will roll off the assembly line before the end of this year.

The rapid growth in demand for luxury vehicles is also fueling new plans by the other carmakers as they make moves to raise output in China.

Mercedes-Benz has announced it will more than double capacity at its joint venture in Beijing to 80,000 cars a year "in the near future" from 30,000 units currently. BMW reportedly plans to build a second plant in northeast China with an annual production capacity of 75,000 vehicles. It now has a 41,000-unit factory with partner Brilliance China.

Thammer said Audi has already shaken off the image of "a car for government officials" as 80 percent of A6 customers now are private buyers, mainly well-heeled business people.

During its early years of production in China, the A6 was the primary fleet car for high-level government officials, which greatly helped Audi, not only through government procurement, but also with private car buyers who followed to display their higher social status. Thammer said Audi "will continue to attach great importance to demands of the two different customer groups".

Other luxury car markers, mainly BMW and Mercedes, are also striving for a slice of the government fleet in China in an effort to catch Audi.

For its part Audi plans to increase the number of its authorized dealerships in China to more than 210 before 2012 from 146 at present.

(China Daily 08/24/2009 page5)