Pandemic has 'peaked out' globally, market to revive in 2021: Hildegard Wortmann, Audi AG

The pandemic has "peaked out" world over and the recovery is recognisable globally and in India too says Hildegard Wortmann, Member of the Board of Management at AUDI AG. Despite the small size, she says the future growth potential in India is ver...

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Talking to ET's Ketan Thakkar, Hildegard Wortmann - Member of the Board of Management at AUDI AG, responsible for global sales and marketing - said that she expects the festive season in India to drive sales momentum before industry revives in 2021. Launching a new mid-term plan - "Consistently Audi" she says the focus on India will be quality over quantity and drive sustainable business. Despite the small size, she says the future growth potential in India is very strong and the new product action will continue with three new offerings in the coming five months to capitalize on festivities.

Edited excerpts:

From pole position to trailing the other German rivals – it has been a roller coaster for Audi in India, is regaining the number 1 position critical in your next mid-term plan?

Moving into the pole position as India’s #1 premium car brand would obviously be an important milestone for Audi. With a renewed focus on customer centricity, we aim to deliver the best value to our customers, dealer partners and stakeholders.

The business model is firmly focused on profitable, sustainable growth and products, and it will serve as our future roadmap in both India and globally. The guiding principle for the next five years plan will be ‘quality over quantity’ as we shape the future of premium mobility.

When do you expect market recovery?
The pandemic has peaked out in many countries and they are coming back to normal in terms of business. A recovery is recognizable from worldwide incoming orders, which are now only slightly below the pre-corona level. We believe the Indian market will also follow a similar trajectory. We anticipate a positive customer sentiment during the upcoming festive season in India and an overall good revival of our segment in the year 2021. Since January ’20, Audi India has already launched three new products and the plan is to launch three more products in the next five months.
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We want to inspire our customers and play an active role in shaping the transformation of our industry. I'm looking forward to playing my part in guiding the Audi brand along this path and to start a growth story in India.

The Indian luxury car market is still very small, what role do you see India post Covid-19 impact?
Yes the luxury car market comprises approximately 1.2% of the overall car market. At 35,000 to 38,000 units sales per year it is still a relatively small number for a market the size of India’s.

In a 2019 white paper, the World Economic Forum noted that the Indian automotive industry is one of the fastest-growing markets globally. So definitely, the growth potential is strong. However, the increasing level of legislation and regulation creates a challenging economic environment for us in India.

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We are committed to a strong Indian market and its future potential in the medium to long term. I am working holistically with the Audi India team to ensure that we have the right products, technology and investments in place.

Can you elaborate on the new plan post COVID-19?
With our “Consistently Audi” strategy, the re-launch of the brand and the Audi Transformation Plan, we have put important levers in position as we address the challenges facing our industry. The coming years will not be easy. We will need to continue earning comfortable returns from our established core business while driving ahead the transformation of our industry.
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The dealers are a strong backbone of our business. Digital transformation has been a buzz word for the longest time. Right now, you can literally see it happen on a day-to-day basis. When showrooms physically closed, along with our partners we found creative ways to stay in contact or even win new customers.

In India, we pioneered the use of augmented reality (AR) and virtual reality (VR) in both our online and on-site sales. Introducing these tools into the car buying process has been met with huge positive resonance here, and we will continue to invest heavily in further developing this technology and service.

On the products front, Audi offers a very young portfolio and we have a full pipeline of future product and technology launches planned across categories – from sedans to compacts to SUVs.

How will the global auto industry change post COVID-19?
All major crises bring people together and help them to come back stronger. Tough situations such as this challenge us, forces us to work more closely and effectively together – and often trigger a revolution in thinking and behavior.

It is great to see the creativity and agility of all our teams and partners worldwide. The pandemic has accelerated the implementation of digital solutions and technologies. I believe we will see formats that became “necessary” to keep businesses, governments and economies running during this pandemic become standardized tools for all businesses – whether that’s e-commerce or e-conferencing.

Our “new normal” will be more connected than ever. This pandemic will have a long-lasting impact on all aspects of society and business. Like many other carmakers, we either shutdown or slowed production globally. Starting in late April, we gradually started ramping up production.

At the same time it was our task to protect the liquidity and thus the stability of our company and, despite all the restrictions, to stabilize our core processes. Now it is time to move forward. To support our partners during the restart phase and to boost sales we are supporting our partners with a special package of measures.

Audi is betting big on EVs including India, how do you see a market like India evolving given its infrastructure challenges? What is the update on E-Tron EV launch?
While the Indian electric vehicle (EV) market saw strong growth in 2019, it still only represents less than one percent of the global EV market. We believe India’s focus on clean, sustainable mobility – driven by consumer, economic and environmental concerns – dovetails perfectly with our shift towards an electric future.

As a carmaker, we cannot do that alone – the realization of a modern electrification and sustainability strategy will require collaboration between government, consumers and industry alike.

Electrification means that the ecosystem around the vehicle will become increasingly important. That means as the number of e-cars on India’s roads increases, we will need to implement a corresponding increase in charging infrastructure.

We can look to trailblazer countries like Norway, which started early and moved quickly and decisively in harnessing the potential of electric mobility – to serve as a guide for other countries that have moved more cautiously in the adoption of this technology.

We see, the demand for battery electric vehicles (BEV) and plug-in hybrids (PHEV) continues to increase. Simultaneously, however, Audi is combining combustion engines with mild-hybrid technology to fulfill the needs in this segment. This allows us to offer a solution for every step of the electrification journey for a country like India.

Regarding the launch of the Audi e-tron in India, we are constantly studying government policies to see how our products can best suit customer needs.
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