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Sales growth not the sole focus: Audi Australia

Outlier: The A5 (below) and A5 Sportback (left) are the only two models in Audi’s stable that have improved in sales compared with last year largely thanks to the launch of new-generation versions of each.

Audi’s 2017 year-end total expected to shrink for the first time since 2004

8 Dec 2017

AUDI Australia’s sales hot streak is likely to be broken in 2017 after 12 years of consecutive growth, but the premium brand is confident it can return to the green in future after shifting its focus toward a more holistic approach to selling cars.

For the first 11 months of the year, Audi’s local sales have tallied 19,938 – a 9.5 per cent decrease over the same period last year – and, with only one month left in 2017, is projected to reach just under 22,000 units.

Last year saw the local division of the Ingolstadt-based car-maker hit its peak with 24,258 new registrations, nearly a 700 per cent improvement over its 2004 tally of 3701 units, but Audi Australia marketing and communications director Anna Burgdorf said the brand’s success cannot be measured on pure volume.

“When we measure success, we measure success in terms of a number of areas,” she said. “(Audi Australia managing director) Paul (Sansom) more recently has talked about the new focus areas for us moving forward, but – for quite some time – our global strategy has been around sales.

“(But also around) being a strong and positive employer, and customer experience – and it’s very difficult to just chase down one of those and be successful in all areas.

“Will we grow again? Yes, we will grow again, but at the moment, there are other things other than volume that are more important to us, or equally as important to us.”

Ms Burgdorf said Audi faced a number of challenges this year despite the launch of new-generation version of its once-segment leading Q5 mid-size SUV, youth-targeted Q2 crossover and all-new A5 luxury mid-sizer.

“We have seen the premium market get a lot tougher and we’ve obviously seen a sales drop in general in the premium market, and I guess our sales rate has reflected that,” she said.

“Interest rates are always a factor … the cost of living is something that impacts the market and also things like consumer confidence and what’s happening in the political landscape. What that tends to do is lengthen the buying cycle, which means people aren’t turning over quite so quickly and that impacts premium car-makers.

“As a general rule, people just become a little more cautious about making that emotional purchase decision … particularly at this end of the market.”

Audi is expected to close out the year in third place behind a dominate Mercedes-Benz that has lifted 3.3 per cent year to date to 34,069 new registrations, and BMW which currently sits on 22,317 sales to the end of November, representing a 15.7 per cent slide over the same period in 2016.

Other premium car-makers have also struggled to keep last year’s pace with Infiniti dropping 1.1 per cent to 739 units, Jaguar down 10.8 per cent to 2366, Lexus losing 3.4 per cent to 8266, Porsche sliding 1.5 per cent to 4261 and Volvo dropping 22.4 per cent to 4281.

Overall however, for the first 11 months of the year, the Australian new-car market is just 0.6 per cent ahead of 2016 with 1,068,296 sales.

While Ms Burgdorf would not be drawn on when Audi Australia sales would again return to growth, she said the brand was sharpening the experience of its customers to become “the best premium brand”.

“We want sustainable sales and we want profitable sales, and … I think we’ve all seen quite a lot of heavy retail activity in the market – for all brands premium and otherwise,” she said.

“I think for us, our focus is on being the best premium brand and that means customer experience, that means customer loyalty, that means …. focusing on things other than just being number one in the sales race.

“We have to look at it over the long term because that’s what any sustainable business does, but when you also take into account the dramatic change in the automotive industry – we’ve never changed as dramatically as we have even in the last two years, and that’s going to keep going.

“And that’s shaking up the entire business model.”

The upheaval cited by Ms Burgdorf includes innovations brought about because of electrified powertrains and autonomous technology – two areas where Audi has already started to break new ground – as well as new models of vehicle ownership and different ways to buy a car.

The introduction of the A3 e-tron Sportback in 2015 was the first time a plug-in hybrid Audi was available in Australia, while its new-generation A8 due in mid-2018 will support self-driving technologies up to SAE-approved ‘level 3’.

Audi’s Q7 e-tron large SUV plug-in hybrid will also land in Australian showrooms early next year, as well as a pair of full-electric vehicles dubbed e-tron quattro and e-tron Sportback looming around the turn of the decade.

“The market is changing and we are all changing with it,” Ms Burgdorf said. “I think it’s short-sighted only to look at the way we operate at the moment and not to look well beyond that because if none of us innovate, and none of us move to what customers will be wanting in the next few years, then we’ll be redundant as car-makers.

“We might all love for it to continue the way it has been because it feels comfortable and it’s what we know, but it isn’t going to be the reality.”

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