The brand image of Audi is basically positioned as "official car". To open up the individual consumer market means a shift in brand positioning, and this kind of "brand relocation" is extremely detrimental to Audi's stable development.
Taking advantage of the vigorous growth of the domestic automobile industry, a high-end brand - Audi has recently set an eye-catching plan for itself: in the next three years, the total sales volume of Audi in China will break through 1 million vehicles. Faced with Audi's "grandiose" three-year plan, from the manufacturers to the terminal sales personnel, all are excited. Relevant personnel of the FAW-Volkswagen Sales Division also repeatedly emphasized their determination to achieve the plan in public places. However, don't forget that sales volume depends on the market sentiment.
The first question is whether Audi itself can reach this sales volume. In the first three quarters of this year, Audi's sales volume in the domestic market was 173,000 vehicles, and it is not a problem to break through 200,000 vehicles for the whole year. But to achieve a sales volume of 1 million in the next three years means that the average annual sales volume needs to reach more than 330,000 vehicles. And looking at Audi's annual average growth rate of about 20% in the past five years in China, the annual growth rate in the next three years must reach at least 25%. That is to say, based on the sales volume of 200,000 vehicles in 2010, the sales volume in the next three years needs to be stabilized at 260,000, 330,000, and 410,000 vehicles respectively. Under the condition that the sales base keeps increasing, maintaining such a high growth rate simultaneously is indeed a big challenge.
Looking at the luxury car market in our country, the growth rate of the domestic luxury car market in 2011 should be around 40%, with an estimated overall sales volume of 900,000 vehicles. Calculating according to the proportion of luxury cars in mature foreign automobile markets (15%～20% of the entire passenger car market), by 2013, the sales volume of the domestic luxury car market in China will approach 2 million vehicles. However, this proportion in our country is only 6%～7%, so the market capacity of domestic luxury cars in 2013 may be around 1 million vehicles. It is worth noting that even if Audi could really gather such a number of cars, due to the limited market capacity, it would be extremely difficult for Audi to sell these 1 million vehicles.
This leads to the second question: what strategies will Audi adopt in competition with its rivals? In the domestic luxury car market, prominent brands include Mercedes-Benz, BMW, and Lexus. Although Audi does not admit that its brand is at a disadvantage, reality proves that in the field of imported cars, which most reflects brand positioning, Audi lags far behind Mercedes-Benz and BMW. Meanwhile, Mercedes-Benz and BMW have been continuously increasing their localization efforts in the past two years, which will continuously reduce costs and lead to continuous price reductions at the terminal level, further weakening Audi's localization advantage. While Audi's competitors keep reducing prices, Audi's own prices will also be continuously pulled down. Once the price reduction is too large, it could likely damage Audi's brand image. Brand image reflects the personality characteristics perceived by the public, especially consumers, demonstrating the evaluation and cognition of the brand, and reflecting the strength and essence of the brand. The impression people have of Audi is mostly as an official car, while Mercedes-Benz and BMW are mainly purchased by individual consumers. For Audi to achieve a sales volume of 1 million in three years, it must necessarily open up the individual consumer market, which can also be felt from the continuous launch of models like the A3 and A5. However, Audi's brand image is basically positioned as an "official car", opening up the individual consumer market means a change in brand positioning, and this kind of "brand relocation" is very detrimental to Audi's stable development.
The third question is: does the target set by Audi conform to the guidance direction of national policies and the development trend of the automobile market? A series of policies in our country, such as purchase tax discounts to stimulate automobile consumption, have ignited the car market in 2009 and 2010. Correspondingly, the development of urban roads has lagged far behind the increase in cars, leading to severe congestion problems in multiple cities. Also, due to consumers' expectations of government policies restricting car purchases next year, it has led to an excessive advance consumption of car sales after 2011. At that time, car sales are more likely to show a negative growth trend. For Audi to achieve a sales increase of over 25% against the trend, the difficulty is imaginable.
Indeed, the public's concern is because of consumers' recognition of Audi cars and their preference for the Audi brand. We do not wish to see Audi being tormented to the point of being battered in the coming years in order to achieve this goal of 1 million units, even damaging the excellent reputation Audi has accumulated over many years.
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