Audi to start used car business in India by year-end

German luxury car maker Audi today said it would start operations for its used car business in India by the end of this year, expecting it to account for up to 20% of its new car sales in future.

"The way Indian market is growing, there is an opportunity in the used car business and we also want to tap it. By the end of the year, we will start our used car business under the Audi Approved Plus brand," Audi India Head Michael Perschke said here.

He said the company's "expectation in the long term for the used car business is to have about 10-20% of our new cars sales in India".

The company today launched the new version of its sedan A6 priced between Rs 37.7 lakh and Rs 47 lakh (ex-showroom Delhi), which will be available in four variants.

The car is being assembled at the Aurangabad facility of VW group firm Skoda.

With the company on an expansion drive in India, Perschke said the company, along with its dealers, will hire 600 people over the next two years.

It currently has 13 dealers and is now looking to take it to over 25 by 2012, with opening of outlets in new cities like Coimbatore, Indore and Lucknow. By the end of the year, the company will have 18 dealers in India.

"In view of this expansion, we will be infusing skilled talent at three levels -- corporate, dealership and production," he said.

On the sales front, the company is aiming for over 5,000 units this year, up from 3,003 in last year. So far this year, it has sold 3,145 units in the Jan-July period as against 1,626 units in the same period last year, up 93 per cent.

"Our target is to have 25% of the Indian luxury car market by 2015 and we are on track," Pershke said.

The company expects the Indian luxury car market to cross 50,000 units annually in the next five years from about 15,000 units in 2010.

He also said the company was evaluating market conditions for bringing cars in the lower segment but did not elaborate.

At present the company sells sedans A4, A6, A8, A7 Sportback, sports utility vehicles Q5 and Q7 along with sports cars R8 and R8 Spyder.

"We have adopted a top down approach in India and we know that there is opportunity in the lower segment where we are not currently present. We are looking at it," he said.

With the launch of the new A6 sedan, the company will be increasing output from the Aurangabad plant.

"From September, we will be starting the double shift, which will increase output to 6,000 units a year from the earlier 3,000 units a year in a single shift," Perschke said.