Audi’s “Madness”

　　Bolstered by its distinguished lineage and toughened by World War II, Audi, eager for brand prestige, has always been ambitious and has never even tried to hide it. Its goal of beating BMW in the global market in 2020 is the best proof.

　　No doubt, Audi’s supreme status in the Chinese market is the reason for such ambition. Nevertheless, after Audi has made its intention widely known, it must be careful in the world’s largest auto market and tolerate no mistakes. That is why Audi has become more and more proactive and aggressive.

　　At the beginning of 2013, Audi announced a development plan in China named “leader’s strategy”. Its main content is that before 2015, Audi will introduce all of its 43 models to China, establish a sales network comprising 450 dealerships and attain its spectacular goal of producing 700, 000 units a year.

　　In Audi’s product introduction plan, hybrid cars are a significant component. In May this year, A6 40 hybrid of Premium C and A8L 40 hybrid of Premium D officially entered the Chinese market. This is but a prelude to Audi’s new energy vehicles’ odyssey to China. According to Boesch, although there are not many consumers in the new energy vehicle market, Audi has foreseen that it is to be an important market in the future, “so we hope to bring more new energy vehicles to the Chinese market to satisfy consumer demand,” he said.

　　Apparently, Audi is not the only carmaker setting its sights on the hybrid market and it is not the earliest to make the move either. As early as 5 years ago, Lexus has brought the hybrid model into China’s high-end auto market by importing whole vehicles. It is estimated that Lexus, which entered the hybrid market first, has captured 80% of the market. So if Audi wants to make its mark in the hybrid market, it has to make strenuous efforts.

　　But to Boesch, this is nothing. “When to roll out hybrid models and whether or not one is the first to do this does not decide one’s ability to be the market leader. Examples abound in Audi. Its Q5 and Q3 were not the first of their kinds in their respective market segments. But they caught up and became market leaders.” Boesch cited these examples to say that Audi is a legendary brand that can catch up and come up on top. And it is no exception in the hybrid and even the new energy vehicle markets.

　　BMW, Audi’s strongest rival in China and the world at large, has its own strategies for new energy vehicles. In 2011, it unveiled “ibrand”, a brand of pure electric vehicles. And i3, the brand’s first model, will enter China at the end of this month, making BMW the first brand to introduce pure electric vehicles into the Chinese luxury car market.

　　When Sohu Auto mentioned BMW’s latest move, Boesch said that Audi has a diverse range of new energy car models and the practical whole vehicle modular technology is used to provide the most mature and feasible energy efficient solution to consumers. He also told us that Audi is also considering producing electric vehicles to maintain its dominance in new energy vehicles.

　　4 days before this interview, Audi China announced that Audi A3 Sportback and A3 Sedan would arrive in China next year. Before this, different rumors about the localized production of Audi A3 have long run wild. Sohu Auto thus asked Boesch how A3 would be introduced into China and when it would be manufactured locally, but he kept us in continued suspense, merely saying that the mystery would be unraveled soon.

　　Not long after the interview, on July 25, at the celebration of Audi’s 25th year in China, the locally produced Audi A3 made its appearance, which is the company’s fifth locally manufactured model. At the same time, Audi announced that the plant in Foshan, Guangdong which has not yet been put into operation, will bring a production capacity of 150,000 units, raising Audi’s overall production capacity to 700,000 units.

　　It took Audi 22 years to go from zero to a million units in China. Increasing from 1 million to 2 million units took 2 years and 9 months. And with a production capacity of 700,000 units, it would take even less time for Audi to produce its third million units, maybe less than a year and a half.

　　Behind these numbers is Audi’s frantic desire to conquer the Chinese market, and its daring prowess as the market leader. According to the Annuals of the Tang Dynasty in the Comprehensive Mirror for Aid in Government, “Creating an enterprise is difficult, but it is already water under the bridge. The difficulty of maintaining the enterprise is what needs to be grappled now.” Sitting at the top of China’s luxury vehicle market, Audi is faced with numerous rivals who would love to unseat it. But we have also seen that the company has abandoned its conservative strategy and go on the offensive to guard its laurels. This shift might be key to Audi’s winning or losing the battle.

　　Below is the transcript of the interview.