“It’s one thing to go fast, it’s quite another to make sure you stop when you must. The ceramic brakes in the R8 V10 Plus are phenomenal,” says Joe King, the head of Audi India, as he brings the two-seater sports car from 270kph to a standstill in a few seconds.
We are at the Hosur Aerodrome near Bangalore, where Audi has done the market launch of the fastest production car the company has ever built—the next generation R8 V10 Plus. Showcased at the Delhi Auto Expo earlier this year, it is priced R2.55 crore, ex-showroom, Maharashra. Powered by a naturally-aspirated 5.2 FSI quattro V10 mid-engine, it goes from 0-100kph in just 3.2 seconds, before hitting a top speed of 330kph. “Buyers would love the feeling of power, and control, this car offers,” King says.
Since it began Indian operations in 2007, Audi has launched over 40 products in the country, including sedans, SUVs and performance cars. “Luxury, to us, is about choice, and our wide range of models has helped us build a strong foundation in India. We are looking forward to a sustained profitable growth as we complete a decade,” King adds.
In 2013 and 2014, Audi was India’s largest luxury car player as far as sales are concerned. In 2015, a rejuvenated Mercedes-Benz sold more units.
Rather than competition, King says Audi’s focus is on the road ahead for next ten years. “We will be introducing products in new segments, with new body styles, new design language and new technologies. We will strengthen dealer network by introducing more customer touch-points and innovative concepts like the Audi Mobile Terminal.”
Audi has a strong base of over 55,000 customers in the country. Add to that the fan base of over 1.2 lakh Twitter followers and 35 lakh Facebook fans. The company has announced it will launch 10 new products in India in 2016.
Could electric or hybrid cars be on the anvil? King says there is a huge potential for India to take the lead in electric mobility. Power minister Piyush Goyal had earlier noted the government is working on a scheme to provide electric cars on zero down-payment. The goal is becoming 100% electric vehicle nation by 2030, he had said.
“We welcome a longer-term focus to see what could be done together with the industry and the government, and how a realistic roadmap could be put in place to move to electrification of mobility.”
Globally, Audi plans to introduce a new electric vehicle model every year beginning in 2018, as it races to catch-up to Tesla and other rivals in the luxury car market. The effort, in all likelihood, will begin with its first all-electric luxury SUV, which will be based on the Audi e-tron quattro concept car that was showcased at the International Motor Show in Frankfurt last September.
King believes India is a perfect market for battery electric fields. “There is a lot of investment going on globally into battery electric fields. We would be happy to discuss it with the government. Of course, there is some infrastructure that needs to be built.”
The next big launch this year is going to be the new A3, the premium compact sedan, the current version of which was introduced in India in 2014. “The new A3 raises the bar in the premium compact segment. It is sportier and more expressive than ever. Its Singleframe grille features sharper contours and is broader. The headlights are flatter,” he talks about the car he appears to be so fond of.
The new A3 will be equipped with new driver assistance systems and engines. On board will be the innovative operating and display concept—the Audi virtual cockpit. The A3 will also get Matrix LED headlights, which were introduced in India in the A6 last year.
The A3 sedan and the compact SUV, the Q3, have been major contributors to the growth of the brand. King believes these models have been game-changers and have pioneered the compact luxury segment in the country. “The Q3 helped us consolidate our leadership in the luxury SUV segment. These models have become the preferred option for customers looking to buy their first luxury car.” In addition, the A4 has been instrumental in building Audi India.
Of late, car-makers that have a strong diesel engine portfolio have been facing challenges. In Delhi, diesel cars with engines above 2,000cc cannot be registered; the Supreme Court had banned the registration in December and the next hearing is expected in July. Mercedes-Benz, in fact, even said its investments will be affected in the long-term due to the ban.
“It’s a challenge. When we come across such decisions, it takes time to adapt. The problem is bigger from a customer point of view; she is confused what will happen next.”
However, he believes it is a great opportunity for car companies to discuss with the government and concerned bodies to build a long-term roadmap. “One must keep in mind the diesel ban has brought the issue of pollution and public health to the fore, which is important.”
A 2015 ICRA report said that India’s luxury car sales are set to triple from 33,000 units a year then to 1 lakh by 2020. However, over the last year, the luxury car market has been flat. King is nevertheless optimistic. “Currently, luxury car players enjoy a little over 1% market share in India, compared to some developed countries where it goes up to 10-15%. So there is a lot of room for organic growth,” he says, adding, “To grow in India, you need to have a strong customer-connect, a good product portfolio, adequate dealer network, and you need to work on training people including support staff. We are now focusing on a service-first approach.”
A service-first approach essentially means growing with existing dealers rather than roping in new ones. Such an approach can ensure immediate profits for people who own such service stations—a swanky dealership with a multi-crore investment needs a few years to break-even; a service station can start earning in a few weeks after it is set up. Audi will add three new service outlets in Thiruvananthapuram, Hubli and Jodhpur this year.
Another growth area is used cars. The company’s pre-owned car business is called Audi Approved: plus. It facilitates customers with transparent and hassle-free old car transactions. Pre-owned cars come with 110-plus checks and are backed by a 2-year warranty. “It’s a very important area for us to allow people to own luxury,” he adds.
Audi entered India in 2007 and, within a few years, owning an Audi became a status symbol. So, what all worked for the company? “Among other things, it was our top-down approach which I think worked for us. We brought our best cars to the country, establishing the brand. We worked on the fundamentals.” Going forward, what will work for the company in India? Audi currently has the oldest product portfolio in the market. The core of the company products will be refreshed over the next 3 years, once again providing it the required push in a market it so loves.