Audi Canada president Martin Sander does not mince words when he discusses goals for Audi in Canada and around the world: “No. 1. That’s the vision worldwide.”
Audi Canada isn’t there yet, not by any means. Last year Audi Canada sold 14,333 vehicles in Canada. While that was a jump of 26.7 per cent over 2009, No. 1 Mercedes-Benz Canada sold twice as many vehicles – 29,632.
Audi Canada is aiming for sales of something north of 16,000 this year and 22,500 in 2012. It’s possible Audi will grab the luxury sales crown by 2015, but it will take quite a lot of work, probably as much luck and a little more help from Audi’s suppliers.
The problem is the supply of parts for Audi’s vehicles. According to Automotive News, Audi’s suppliers are still recovering from the big recession of 2008-2009.
Audi AG CEO Rupert Stadler said Audi simply cannot get enough parts to meet demand.
“It is not only in the U.S., but worldwide,” Stadler told Automotive News. “Our suppliers have not withstood the global crisis in 2009 as good as we did.”
Stander echoes his comments.
“I cannot get enough cars because we have fantastic demand around the world,” says Sander, who is on the West Coast to announce two new Audi dealerships – on in downtown Vancouver, the other in Langley, about an hour’s drive east of Vancouver.
The new Audi dealers in Canada are slated to open their doors in 2012. Combined, they are expected to sell at least 1,200 vehicles in their first year of operation. Total combined investment: $27-million. When both open, Audi Canada will have 43 dealers in Canada.
The Vancouver store is operated by the Dilawri Group, which has annual revenues of about $1-billion from its 36 dealership across Canada. The Langley store is owned by the Goldkey Group, a much smaller company. Both are privately held.
Ajay Dilawri, one of three brothers who operate the group, says he sees a fantastic growth opportunity selling Audis – even if he’s been required to make a $17-million investment to build a brand new Audi dealership from the ground up.
The fact is, Audi plans ambitious growth in Canada, the United States and around the world. Sander says a growing product portfolio and a number of hybrid derivatives will push sales. The plan is to be the No. 1 luxury brand worldwide by 2015.
The hybrid story is quite interesting given it is so ambitious. Audi plans to get very aggressive with hybrids over the next 18 months. The Q5 and A6 hybrids will be launched in Europe this year, followed by an A8 hybrid next year. All of these models will come to China and North America within two years.
Sander says one of his biggest concerns is growing too fast, putting at risk customer satisfaction.
“Audi Canada has almost doubled (sales) in three years. We need to watch our growth carefully – balance growth with quality,” he says.
That’s no small balancing act. As perhaps one sign of the challenge Audi is facing, consider this: In the most recent three-year J.D. Power and Associates Vehicle Dependability Study (VDS), Audi slipped to No. 26 overall from No. 12 a year earlier. Audi had 25 more problems per 100 than in 2009 (182 problems per 100 vehicles) because of the A4 convertible and the Q7, said J.D. Power.
Rapid growth is exciting, but never easy, never without problems. And the number of problems reported with Audi’s vehicles certainly must go down.