Audi high-performance segment: sportiness and emotion delivering high returns
High pricing power, strong margins and scaling advantages – the Audi high-performance-segment is more than just emotionally charged. It is also delivering a vital value contribution for the Four Rings. A broader model range, new business areas and electrification are set to take this to another level.
Talking Business – Key Facts
- Emotionally charged products in the high-performance-segment guarantee Audi high customer loyalty and price acceptance. Meanwhile, economies of scale and synergies can be exploited across the Group.
- Audi has clear growth targets for the high-performance-segment: It aims to double unit sales by 2023 compared with 2018.
To achieve these targets, Audi is
- expanding its product portfolio with 13 new R- and RS-models by 2020,
- increasing market penetration through region-specific model mixes
- especially in the important United States and China markets,
- extending the life cycle in future model generations with earlier market introductions,
- expanding new business areas such as vehicle customization.
- Long-term, Audi will adopt a consistently electric focus including in the high-performance-segment, to leverage extra market potential.
Guaranteed to set your pulse racing. That is what the Audi high-performance-models are about. They are the sporty vanguard of the Four Rings, the most emotionally charged products that Audi has to offer. This very emotionality guarantees high customer loyalty and price acceptance in the high-performance-segment.
Audi has plans to capitalize even more on emotionalizing the segment. Audi intends to double its unit sales in the high-performance-segment by 2023. At the International Motor Show in Frankfurt, Audi is showcasing innovative electric models as well as the two entirely new RS-models RS 6 Avant and RS 7 Sportback. “Starting with the R8 facelift, we will be taking the wraps off a total of 13 new R- and RS-models between now and the end of 2020,” comments Julius Seebach, one of the two Managing Directors of Audi Sport GmbH.
At Audi since 2015, Julius Seebach was initially responsible for Strategy and Powertrain Area Management within Technical Development. In 2017, he successfully introduced product line management at Audi Sport and has since been in charge of the RS 4/RS 5 and RS 6/RS 7 Sportback product lines. Julius Seebach has been Managing Director of Audi Sport GmbH since May 2019.
The right model on the right market at the right time
As well as brand image and model diversity, market penetration is hugely important in leveraging the ambitious sales targets. Especially in China and the United States, Audi has plans to expand the high-performance-segment further. In the future, it will be bringing even more R- and RS-models to market. Market-specific model mixes offer a portfolio perfectly tailored to the requirements of customers in the various regions. In the United States, for example, the Audi RS 6 Avant will go on sale for the first time from 2020 – at the explicit request of customers.
In addition, in future model generations the RS-models are to become available just six months after the market introduction of the base mode. This will enable Audi to extend their life cycle by one year. The brand will therefore be able to exploit the huge sales potential directly after a model’s introduction. The period on sale will be extended and Audi will be able to make more of the positive rub-off effect of sporty RS-models on the other cars in the model series.
Additional parts: growing market with healthy profit margin
Audi is also looking to new business areas in the high-performance-segment: The topic of customization is becoming ever more important. Customers want to give their Audi a very individual, sporty accent, for example through special wheels. One in four Audi cars is already equipped with exclusive items from Audi Sport GmbH. As well as high-quality genuine parts and design, Audi offers an excellent advisory service. That is how the brand has come to enjoy high willingness to pay and good profit margins in this growing market.
Oliver Hoffmann has been in charge of the executive management of Audi Sport GmbH since June 2018 and Head of Technical Development at the Neckarsulm site since May 2019. Hoffmann’s previous stations in his career include quality management at Automobili Lamborghini and at Audi’s Hungarian plant in Győr, as well as the development of the V10 high-performance engines in the Audi R8.
Consistently electric – in the high-performance-segment, too
Long-term, Audi is looking to electrification to unlock extra market potential including in the high-performance-segment. “Electric driving offers our customers new dimensions for a sporty driving experience,” explains Audi Sport GmbH Managing Director
Oliver Hoffmann. Stepless acceleration, the best possible torque distribution and very sporty handling are just a few examples. “One thing is clear to us: Performance and electrification are a perfect fit.”
The Audi RS 6 and RS 7 are already available as mild hybrids and are therefore partially electrified. In addition to the new plug-in hybrids such as the Q5 TFSI e, Audi continues to expand its portfolio with high-performance-plug-in-hybrids. Next year the Four Rings will reach another important milestone with the brand’s first fully electric sports car, the Audi e-tron GT.