Audi becomes the latest car brand to confirm it’s moving upmarket with its models as the brand attempts to add a jolt to slumping sales.
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Audi UK’s CEO confirmed that the brand is moving upmarket following Jaguar’s lead in a recent interview.
When Jaguar announced that it was moving upmarket in its push to become an all-electric automaker, it sent shockwaves through the automotive world partly because of the abstract way the company chose to market the whole thing. It left folks wondering if any more automakers would follow Jag’s lead and also take a step further upmarket.
As it turns out, we didn’t have to wait very long for an answer with Audi confirming that it will also be moving upmarket as the four-ringed luxury brand attempts to improve its profit margins while also improving sales with the brand not only losing ground to traditional rivals like BMW and Mercedes-Benz but also ground to Tesla which surpassed Audi in this category for the first time ever.
Profit margins ignite move into pricier territory
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Unlike Jag, Audi is taking a more conventional approach in its move upmarket but look for some models to be cut along the way.
While sales numbers often dictate the decisions of an automaker, Audi’s decision is actually an attempt to improve profit margins with Audi UK’s CEO Jose Miguel Aparicio detailing the plan in a recent interview he had with the publication Auto Express stating “We are making a step upwards in terms of premiumness, increasing the prestige, desirability and perception of the brand, and more interested in the quality of business than the quantity.”
This change in plan will involve a significant increase in price to reflect Audi’s new place in the VW brand empire though this increase will reportedly not intrude on Porsche’s territory with that brand focused on appealing to its own unique clientele which prefer having high amounts of performance and exclusivity in their purchase versus Audi who always focused on technology and providing an interior design that’s a step up from the mainstream VW models.
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Higher pricing will be accompanied by more luxury
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Higher prices will be accompanied by higher levels of luxury with recent concepts like the Grandsphere suggesting the brand will put a greater focus on style and technology.
Audi knows that it needs to do more than just merely raise prices to help it transform into an upmarket brand, it also needs to offer buyers more of everything to justify their investment. This will come in the form of enhanced luxury features and technology which would allow Audi’s models to stand out better against rivals in the ultra-luxury market. This is what upmarket buyers want and Audi knows that being a leader in tech and luxury will help it get better profits versus being a follower in the segment.
The brand has already made some baby steps in this upcoming transformation with Audi confirming the A1 and the Q2 models will not survive into another generation as the sacrifice of these models and others would be needed to help provide more resources for the release of new models that would comply with Audi’s new posher identity. This would mean that the A3 will be the brand’s cheapest model for now but changes on the upper end of the lineup could be delayed too with reports saying a successor to the A8 based on the Grandsphere concept will be postponed. Instead, Audi could continue to offer the aging A8 for a few more years with the big four-door getting another facelift as part of the reported plan.
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