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Audi Plans to Doggedly Pursue Higher U.S. Sales

Maker’s new models designed to continue growth in America.

by on Aug.09, 2013

Audi of America's Scott Keogh said the maker plans to continue setting sales records in the U.S.

Audi plans to remain vigilant about not allowing its dazzling sales gains achieved during the last four years slip away anytime soon despite the rising competitive pressures in the luxury segment.

Audi of America President Scott Keogh confirmed Audi expects to set a new annual U.S. record that will exceed 150,000 units this year. By topping that figure, Audi will set its fourth consecutive full-year record and nearly double the 77,917 vehicles sold less than a decade ago.

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The maker recently reported that July was its 31st month of record U.S. sales, Keogh said. In addition Audi AG also confirmed that it would record sales of 1.5 million vehicles this year: two years earlier than promised. (more…)

Booming Sales Put Volkswagen of America Back in the Black

First profit in over a decade.

by on Mar.29, 2013

Workers at the new VW plant in Tennessee have had trouble meeting the growing demand for the American-made Passat.

For the first time since the original Beetle dominated the American import market, Volkswagen of America is moving solidly back into the black.

The German maker’s U.S. sales and marketing arm had steadily lost sales, share – and lots of money – ever since Asian rivals like Toyota and Honda became dominant forces in the market back in the late 1970s. In fact, VW’s decline was so severe that the maker came close to abandoning the U.S. in the early 1990s.

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But, over the last several years, it has picked up significant momentum with a mix of new products, aggressive marketing – and the addition of its first U.S. factory in decades, in Chattanooga, Tennessee.

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Audi Betting Big on Little A3 Sedan

Plug-in hybrid version to follow, likely by late 2014.

by on Mar.27, 2013

Audi gives media a sneak peak at the 2015 A3.

For such a small car, Audi has a lot riding on the success of the all-new A3 sedan that got its debut during a media sneak peek prior to this week’s New York International Auto Show.

The 2015 Audi A3 is targeting a downsized segment that could become one of the fastest-growing niches of the U.S. luxury car market, industry analysts forecast, especially if fuel prices continue to rise. The German maker developed a sedan version of the compact A3 specifically for the U.S. market rather than going with the next-generation wagon – Sportback in Audi lingo – that will be the primary offering in Europe and most other parts of the world.

“Sedans are the way to go” in the U.S., where wagons have traditionally been a hard-sell, said Scott Keogh, head of Audi’s U.S. sales subsidiary, during a conversation with TheDetroitBureau.com. The outgoing Sportback model had a modest but loyal following, the executive noted, and actually gained some traction last year, especially for its diesel-powered version. But the new A3, which will launch in the spring of next year, is expected to be far more popular.

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Declaring it “crucial” to Audi of America’s aggressive growth plans, Keogh said the new A3 will be the brand’s “third leg, a real volume car,” along with the bigger A4 and A6 luxury lines.

The redesign of the compact A3 reflects shifting trends in the luxury market. Buyers are not only downsizing but also they’re expecting today’s smaller offerings to deliver the sort of luxurious features that were once found in larger and notably more expensive models.

“This A3 line-up redefines the standards of its class in dynamics, efficiency, technology, craftsmanship and performance,” Keogh said during his media preview.

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New Audi Chief Aims to Topple Luxury Leaders

“We want to be the definitive luxury brand.”

by on Jun.26, 2012

Audi of America's new boss, Scott Keogh, sees significant opportunities ahead.

Long an also-ran in the U.S. luxury market, Audi is aiming to topple the established upscale leaders, said the brand’s new American CEO.

The target is to nearly double overall sales to 200,000 annually – while making sure it captures a larger share of customers willing to spend $70,000 to $80,000 for new vehicles like the top-line A8, Scott Keogh, the new president and CEO of Audi of America stressed during his first press in the new job.

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“We want to be the definitive luxury brand in America and outsell BMW and Mercedes-Benz,” said Keogh, as he outlined the brand’s plans for the near future.

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Scott Keogh Named New Audi of America Chief

Replaces long-time boss De Nysschen.

by on Jun.21, 2012

Luxury segment veteran Scott Keogh will be Audi's new president, replacing Johan De Nysschen.

Audi of America has a new president, current marketing chief Scott Keogh taking the reins after the recent, surprise departure of the maker’s long-time U.S. boss Johan De Nysschen.

The 43-year-old Keogh steps in at a good time for the automaker which has posted 17 consecutive months of record sales, reaching an all-time high in the U.S. market last year.  But the new Audi of America president will have to now prove he can maintain that momentum – and position Audi to meet a target set by his predecessor of nearly doubling sales by 2016.

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“Audi has demonstrated remarkable progress in recent years,” said Keogh from Audi’s U.S. headquarters in the Washington, D.C. suburb of Herndon, Virginia. “There is much work to be done in a highly competitive segment of the auto business. But the sights are set and the team is in place to meet our goals.”

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New Volkswagen Midsize SUV “Under Discussion”

Maker considering range of additional products, including Polo and Up! to support soaring U.S. sales.

by on May.30, 2012

VW Group CEO Jonathan Browning -- shown here at the 2012 Detroit Auto Show -- wants more product in the U.S. line-up.

With U.S. sales expected to increase by as much as 30% for May Volkswagen is looking at all its options to keep that momentum going – including the addition of all-new products to its American line-up.

The maker could start importing several models not currently sold in the U.S., said Volkswagen Group of American CEO Jonathan Browning.  But the executive says the more likely move would come with the addition of an all-new midsize SUV now “under discussion.”

“A midsize SUV would be a great opportunity for us,” Browning said following a speech to the Detroit Automotive Press Association.

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The vehicle would slot into the line-up between the compact Tiguan and the full-size Touareg sport-utility vehicles.  It might be developed as a joint project between the U.S. and “another region around the world,” Browning hinted, but he stressed that the American market would take the lead in the vehicle’s development.

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Audi Opts for New Plant in Mexico

Anticipates cost of less than $2 billion.

by on Apr.19, 2012

Audi Chairman Rupert Stadler introduces one of the maker's new models.

After years of debate, luxury maker Audi has finally won approval from parent Volkswagen AG to build a new North American assembly plant that could help fuel its record growth in the U.S. and other markets.

But the maker of products like the A6 and Q7 has decided to locate the facility in Mexico, rather than the United States, it has announced.

“As an established carmaking location, Mexico offers an excellent economic basis for Audi production operations,” said Audi Chairman Rupert Stadler. “Mexico is one of the world’s top ten automotive locations and offers a blend of tradition and experience.”

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Mexico now has significantly more production capacity than its own market needs might justify, industry analyst note, and continues to gain more rapidly.  Nissan recently announced a multi-billion-dollar project near Aguas Calientes, with alliance partner Mercedes-Benz considering a nearby site. And Honda earlier this month broke ground on a new plant in the country that will produce the subcompact Fit, among other models.

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Audi May Get Go for New North American Plant Tomorrow

But maker reportedly leaning toward Mexico v US.

by on Apr.17, 2012

Audi CEO Rupert Stadler, shown here with the etron concept, reportedly wants the new plant in Mexico.

The long-delayed decision on whether to build an Audi plant on this side of the Atlantic could be resolved as early as tomorrow, insiders suggesting that parent Volkswagen Group will formally give its approval on Wednesday.

But other reports caution that the new factory is more likely to go into Mexico than the U.S. Mexico has become a hot spot for global automotive manufacturers looking to take advantage of its central location, low manufacturing costs – and the extensive array of automotive free trade agreements Mexico has lined up with countries around the world.

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The parent VW Group is apparently supporting the idea of building the new plant in the States, according to Germany’s Automobilewoche magazine.  But Audi CEO Rupert Stadler has been lobbying for a site in Mexico.

VW recently opened a new factory in Chattanooga, Tennessee and has seen a sharp surge in demand for the Passat model produced there.  That has led to a rapid expansion of capacity in Chattanooga.  VW may prefer to take advantage of the supply and distribution network set up to support that factory.  And it might see an advantage to placing a plant in the U.S. as a way to help spur demand in one of its weaker markets.

While Audi has been setting sales records in the United States, it still lags sharply behind key competitors BMW, Mercedes-Benz and Lexus, even though the VW brand is now one of the top sellers in the global luxury market.

The “Made in USA” label could prove important in boosting sales, Michael Macht, the VW Group’s manufacturing chief, told Automotive News earlier this year.

But there are plenty of reasons why Audi CEO Stadler appears to be favoring Mexico, sources stress.  Indeed, VW has long favored the Spanish-speaking nation where it has been building such models as the Beetle.

The typical Mexican automotive assembly plant’s total labor costs run about $8 an hour, according to industry data.  Quality has proven extremely high.  There is an extensive supplier network and reasonably good distribution system for completed vehicles.

Among other things, Audi might be able to directly tap a new powertrain plant in Silao, Mexico, which will launch production next year and offer capacity of up to 300,000 engines annually.

Meanwhile, Mexico has signed more automotive free trade agreements than any other country except Israel, meaning minimal duties on products exported from the country.  That could be seen as particularly useful to supply Audi’s growing sales in not only the U.S. but emerging markets, like Brazil, Chile and Argentina, in South America.

Audi isn’t the only high-line maker weighing its Mexican options.  Mercedes-Benz recently announced that it will build a second North American plant to supplement the existing facility in Alabama.  While officials only say they are considering several options, insiders have told TheDetroitBureau.com that the German maker is leaning heavily towards a site in Aguas Calientes.

That would put it adjacent to, and perhaps even on the actual campus of, a new Nissan plant announced earlier this year.  Mercedes’ parent, Daimler AG, has been rapidly expanding its partnership with the Euro-Asian Renault-Nissan Alliance. Among other things, that includes providing the MFA small car platform that will be used for a production version of the Infiniti Etherea concept vehicle.

The Daimler plant, if it goes to Aguas Calientes, may produce vehicles for both Mercedes and Nissan.

As for Volkswagen, both the Chattanooga plant and the Audi facility would become critical pieces in the maker’s plan to achieve global dominance by 2018, when its various brands aim to collectively sell at least 10 million vehicles annually.

VW Inching Towards Profitability in the States

2011 sales should hit 300,000 despite slow U.S. recovery.

by on Sep.29, 2011

The new U.S. version of the Jetta has been instrumental in VW's American revival.

Long operating deep in the red, Volkswagen’s U.S. sale unit is on track to turn a profit for the first time since 2003, according to the German maker’s top American executive.

“This is our expectation,” Jonathan Browning, Volkswagen Group of America’s president and chief executive officer told reporters after an appearance at the Society of Automotive Analysts’ annual strategic planning summit.

VW’s luxury arm, Audi saw its North American sales operations become profitable last year, Browning added, in the face of steady growth in demand.

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“This is a very narrow definition of profitability,” Browning cautioned, noting that it doesn’t include financial statements from the company’s parts distribution network, nor does it include the share of corporate overhead allocated to North America by VWGoA’s parent company in Wolfsburg, Germany.

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China Driving Audi as it Leapfrogs Mercedes-Benz

But U.S. still critical market for VW luxury division.

by on Apr.12, 2010

With products like the new Audi A1, the German automaker hopes to maintain its lead in the global luxury sales sweepstakes.

As it expands its lead as the world’s largest auto market, China is changing not just the rules but realigning the pecking order of the global auto industry.

For the first time, this past quarter, Mercedes-Benz saw itself slip into second place on the global luxury sales charts, behind upstart Audi, the Volkswagen AG subsidiary that has become the dominant high-line player on the Chinese scene.

But despite decades of struggle, Audi continues trying to reposition itself as a leader, rather than an also-ran in the U.S., now the globe’s second-largest auto market. And company officials say they may be in for some gains – if they can just get the factory to provide American dealers with more product.

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For the first three months of 2010, it seems, Audi hit a record 264,100 vehicles worldwide, compared with just 248,500 for Daimler AG’s Mercedes brand.  If the Volkswagen subsidiary can maintain that momentum it could exceed its five-year goal of becoming the world’s largest luxury brand.  The original target was 2015, when Audi had hoped to boost sales to a whopping 1.5 million units annually.

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