At a time when most luxury automakers are paring back spending in case the European economic crisis worsens, or in case the U.S. drops back into recession, Audi has its sights locked on its main German rival BMW. To surpass BMW atop the luxury pyramid, Audi knows it needs to invest in new vehicle development, factory expansion and targeted marketing. Success comes at a price, and for Audi that price is $17 billion, to be spent over the next four years.
As The San Francisco Chronicle (via Autoblog) explains, nearly $14 billion of that investment will go towards vehicle development and factory expansion, including the construction of a new plant in Mexico to serve the North American market. Research and development spending will concentrate on lightweight construction (likely via the extensive use of aluminum) and even supplemental electric power.
By the end of this decade, Audi is projecting annual global sales of two million vehicles, which should be sufficient to overtake BMW. While BMW will also see sales increase, the smaller automaker is incapable of matching the investment that the Volkswagen Group is willing to spend on Audi’s growth. Don’t expect Mercedes-Benz to sit idle as rivals steal market share, either; it’s planning on countering Audi’s advances with a new product blitz aimed at first time luxury buyers.
Which automaker will ultimately come out on top is academic, since the real winners will be the consumers who benefit from the increased competition between the brands.
Kurt Ernst has been passionate about automobiles and driving nearly his entire life. His early years were shaped working in the family service station, though his real passion was auto racing. After graduating from the University of Colorado, Kurt spent a year club racing with the Sports Car Club of America, before focusing on a business career in marketing and project management. Later, his passion for writing and the automotive hobby found him freelancing for a variety of automotive news sites, including Automotive Addicts and Motor Authority, where his work was syndicated and appeared in several national publications. Recognized as an expert in the automotive field, Kurt joined Hemmings Motor News as an Associate Editor in 2013, and in the years since has progressed to Editor, Hemmings Daily; Managing Editor for Hemmings Motor News, Hemmings Classic Car, Hemmings Muscle Machines, and the Hemmings Daily; and now, Managing Editor, Hemmings Auctions. Kurt was instrumental in organizing the Hemmings Motor News Concours d’Elegance from 2013-2019, and has served as a judge at this event and The Vintage Racing Stable Concours d’Elegance. A Skip Barber Racing School graduate and prolific writer, Ernst is also skilled in copyediting, project management, brand development, and public relations.
