Audi Plans To Drive Down In Luxury
German automobile major Audi AG plans to set up a wholly-owned subsidiary in India to target the domestic luxury car market along with companies like BMW and Mercedes.
The DM 18,807 million automobile company, part of the Volkswagen group, is conducting a feasibility study for the proposed 100 per cent subsidiary, subsequent to which permission would be sought from the Indian government.
Our companys ideas are very clear. India is a strategic market and we would like to come here through a wholly-owned subsidiary so that the company can tap the Indian market more effectively, Audi area sales manager (Asia Pacific) and head of Indian operations Sunil Kaul said yesterday.
However, neither Kaul nor Audis incharge of media relations, corporate and finance, Jurgen De Graeve, were forthcoming on the size of investment the company plans to make in India.
The size of investment will be decided after the feasibility study is completed. We are not looking at India from a short-term viewpoint...we would like to stay here and grow with the luxury(car) market, Kaul explained.
According to Kaul, Audi may set up a production facility in India with another Volkswagen group company Skoda Auto. We are seriously exploring the idea of setting up a production facility in India to cater to the domestic market, as we feel there is great potential for here, Kaul added. In Asia, Audi has production facilities in China, Malaysia, Indonesia and the Philippines.
The Volkswagen group has been eyeing the Indian automobile market for a long time and had held extensive talks with the Delhi-based Eicher group for a joint venture for the Felicia and the Octavia models from the Skoda stable, along with a few Audi models.
However, last year, the talks were called off following the inability of the two partners to reach a consensus on the equity shareholding in the proposed venture. Thereafter, both Audi and Skoda had been scouting around for a suitable entry path into the domestic Indian market.
Audi AG, which had 6.1 per cent market share last year in Germany, followed by 5.4 per cent market share in Austria two of its biggest markets does not plan to use the Indian proposed production facility in India for exports purposes.
Audi, which plans to start the sale of its new A6 and A4 model of diesel cars in India from next month through imports of completely-built-up-version (CBU), priced between Rs 24 and Rs 28 lakh, has also drawn up a blueprint to increase its dealer network in India from two in Mumbai to about six by the year-end.
Appointment of a dealer in Delhi would help us increase sales of Audi cars in CBU in the country, Graeve said. Last year the German auto major sold about 20 cars here and has targeted to sell about 100 cars in the next 18 months.
Audi belongs to the leading international manufacturers in the premium segment. It has positioned itself as one of the leading premium brands in Germany and Europe, with features like a four-wheel drive, aluminium body and direct injection turbo diesel system.