Investor Relations Corporate strategy

Vision: “Audi – the premium brand”

The Audi Group first unveiled its Strategy 2020 in 2010, then refined it in the following year. The cornerstones of this strategy remain unchanged and place the emphasis on sustainable, continuous corporate success. The aim is to equip Audi for the challenges of the future along its pathway to becoming the leading premium brand, and to delight customers worldwide. The issues and measures were further substantiated in 2012 and adjusted to reflect the prevailing economic and business environment. In particular, questions about growing environmental awareness, the future availability of fossil fuels, ongoing urbanization and increasing digitalization and connectivity play an important role in this context.

The Audi brand’s strategy 2020

Mission: “We delight customers worldwide”

The Audi brand has placed evoking customer delight worldwide at the very heart of its strategy, as the key component of its mission. The brand values sportiness, progressiveness and sophistication are convincingly embodied by the products of the Audi brand. In addition to supplying technologically advanced, innovative automobiles, it aims to generate customer delight in a wide variety of other ways. The Audi brand has defined its understanding of customer delight in greater detail in the following four areas of action, which it examines, formulates and substantiates as part of an ongoing process:

• We define innovation
• We create experiences
• We live responsibility
• We shape Audi

We define innovation
The Audi brand has set itself the task of offering its customers sporty, high-quality and innovative vehicles and mobility solutions. That ambition is expressed in the brand essence “Vorsprung durch Technik” and is emphasized by the clear, distinctive design idiom. Important technologies that will play a key role in the future, such as electric drive systems, lightweight construction and connectivity are brought to production maturity.
All activities involving electric mobility are bracketed together and developed under the Audi e tron name.
Lightweight technology, too, enjoys a special status at the brand with the four rings. Audi has played a pioneering role in this area ever since the introduction of the Audi Space FrameAudi Space FrameThe Audi Space Frame is a high-strength aluminium frame structure into which all panels are integrated so that they also perform a load-bearing function.Audi Space Frame (ASF) in 1994. Its solutions for paving the way for lighter vehicles have been gradually refined ever since. The name Audi ultra headlines this approach. Vehicle weights are steadily being reduced thanks to intelligent combinations of materials which include aluminum, carbon fiber-reinforced polymers (CFRP), modern steel alloys and magnesium. For instance, the new Audi A3 Sportback is up to 90 kilograms lighter than its predecessor model.
Reflecting the increasing connectivity and digitalization of our society, the Company uses the umbrella term Audi connect to group together all functions that connect the driver with the Internet, the car and the world around him or her. As well as trailblazing assistance and infotainment functions, driver-friendly Internet and smartphone applications are integrated into the vehicle.

We create experiences
The Company aims to create special, positive experiences to delight its customers time and time again. Modern sales concepts such as Audi City, the cyberstore for urban centers, are part of this approach. The first location was opened in July 2012 in London, close to Piccadilly Circus; the compact premises allow the growing model range to be presented complete with all color and equipment combinations, for customers to experience individually. Following the opening of the second Audi City in Beijing in January 2013, the concept is now to be rolled out in other mega cities in order to generate delight among potential customers for the Audi brand.

The Audi brand can also be experienced close up at exclusive events staged in German cities, which in 2012 included the Audi Classic Open Air Festival in Berlin and the Hamburg Stadtpark Revival historic car race.
Emotion-packed moments are also provided by the Audi driving experience, with its various driving and safety training events acting as a gateway to memorable experiences of the Audi brand. To make the range even more attractive for our customers, the new Audi driving experience center is currently being constructed in Neuburg an der Donau on a 47-hectare site.
The new car collection facilities at the Audi Forums in Ingolstadt and Neckarsulm offer our customers another emotional highlight. In addition to receiving insights into the historical progress of the brand with the four rings, customers learn all about the sheer precision and care that goes into the making of an Audi brand car. Accompanied by a customer relationship manager throughout the entire day, customers are given a personal tour of the factory, making the occasion a truly memorable one.

We live responsibility
Audi’s corporate self-perception extends beyond business success to also include social and ecological aspects as part of being a balanced contributor to society. The Audi Board of Management approved approximately a dozen corporate projects in the course of the 2012 fiscal year. These range from the development of drive energy from renewable sources, through the first Audi Stakeholder Forum, to support for voluntary employee activities and a pilot study of the corporate carbon footprint – a calculation of how much CO2 is emitted throughout a product’s entire life cycle.
AUDI AG adopted various dialogue formats in 2012 as part of its new venture into stakeholder management. The aim is to channel the opinion of all stakeholders that are relevant for Audi into the Company and to weave their expectations into the corporate responsibility strategy. Elements of that dialogue included a sequence of interviews with 17 internal and 17 external stakeholders, an online survey of almost 500 participants and a stakeholder forum in Ingolstadt attended by 60 representatives from the worlds of business, science, non-governmental organizations (NGOs) and politics.
By way of gauging its own sustainability performance, AUDI AG moreover took part in the renowned rating process of oekom research. The Company was awarded the distinction of “Corporate Responsibility Prime Status” in recognition of its above-average contribution to social and environmental compatibility.
Corporate decisions as well as future activities and guidelines are based on the findings of the stakeholder survey and the sustainability rating, as a matter of corporate responsibility.

We shape Audi
In order to maintain our sustainable and profitable growth in the future, our structures and processes are constantly being refined and developed. As well as our continuing model initiative and volume growth, we are placing the emphasis on increasing internationalization and the development of new technologies and areas of business. It is therefore vital to have an organization that is equipped to handle such tasks. Product and investment decisions are made specifically on the basis of customer benefit.
With their expertise in and passion for the products of the Audi brand as the starting point, all employees play a key role in the successful realization of qualitative growth.

Superior financial strength

The Company’s financial strength is measured in terms of a sustained, steady development in profit. In keeping with a value-oriented corporate management approach, growth therefore only meets the premium standards of the Audi Group if it is simultaneously profitable. Qualitative growth is therefore a top priority for us as a strategic corporate objective.
This is achieved above all through effective and efficient structures and processes, systematic investment management and the ongoing optimization of costs. A high level of self-financing helps to preserve the Company’s scope to invest and act. The objective of fundamentally covering investment from self-generated cash flow therefore remains a key pillar of our corporate strategy.

Continuous growth

In a challenging market environment, the Audi brand set a new deliveries record in 2012 in handing over more than 1.45 million vehicles to customers. This positive development is primarily attributable to the attractive, diverse product range, which was again continuously revitalized and broadened in the period under review. Alongside the new Audi A3, which made its debut in the past fiscal year, the Audi brand added models such as the A1 Sportback and the sporty S6, S7 Sportback and S8 to its product range.
The Company intends to increase deliveries of the Audi brand to 2.0 million vehicles by 2020. To that end it will maintain its product initiative and further increase its market shares in a large number of sales markets. The Audi Group is consequently adding to the number of its dealer and service outlets worldwide. The Audi Group’s worldwide production network is also undergoing steady expansion. Besides a new car production line, which is currently being built at Győr (Hungary), Audi is stepping up its presence with the construction of a new plant in Foshan (China) and the building of a new production location in San José Chiapa, Central Mexico.

Global image leader

A strong brand and a positive image are key success factors for a premium manufacturer. They pave the way for lasting corporate success. Our goal is therefore to keep steadily improving both our image position and our attractive product range, while binding customers emotionally to the Audi brand.
A large number of national and international awards in the 2012 fiscal year again served to confirm the positive image and public enthusiasm for the brand with the four rings.

Attractive employer worldwide

In order to realize its strategy of becoming the leading premium brand worldwide, the Audi Group is reliant on the expertise and commitment of the best and most highly qualified employees. Especially in light of its continuing international expansion and global presence, it is therefore exceptionally important for our Company to be perceived as an attractive employer worldwide.
The Audi Group therefore offers its employees a challenging working environment with a wide range of opportunities to develop, as well as attractive, commensurate pay coupled with high job security. To assure a consistently high level of employee satisfaction, we regularly conduct internal employee surveys.
The Audi Group’s high attractiveness as an employer is moreover confirmed by a large number of external surveys conducted both nationally and internationally.