Audi India, a subsidiary of Germany’s Audi AG, sold more than 10,000 vehicles in India in calendar 2013, making it the largest luxury car manufacturer in the country.

The company maintained the growth in the first quarter of 2014 (calendar year) by grossing a total sales of 1,404 units in March 2014, an 18 per cent rise from 1,104 units sold during the same month a year ago. For the luxury car manufacturer, March has been the best-ever month since it started operations in 2007.

Joe King took over as Audi India head about eight months ago after his predecessor Michael Perschke had built a good foundation.

King, who came after a long stint in Sydney, Australia, says India is a very important market for Audi AG worldwide – both for its demographics and its market position.

Excerpts from a tete-à-tete with Business Line :

Audi is a luxury brand, and despite the slowdown in the industry, you did sell more than 10,000 units last year. How did you achieve that?

It could be attributed to our strong connect in the social media through experiential marketing for driving, sports car and city experiences, among others. We have 3.5 million Facebook fans, the second highest community for Audi behind the US.

Matching that, we have brought in the right products that Indian costumers were looking for. Our range has been selected well and we are also investing heavily in our people.

Touching the 10,000 sales mark came much ahead of your expectations and pleasantly during your tenure. What next?

Michael Perschke (former Audi India head) did a wonderful job and the results are showing now. When I was asked in November what the view would be, I said we have an election in the first half of the year and I didn’t expect to see much growth. My feeling is that we will see a bit of catch up in the second half.

Overall, I expect the growth of the luxury market to be the same as last year’s at 6-7 per cent. Let us not look in terms of double-digit growth always. I was also pleasantly surprised that the first quarter was a bit stronger than our expectations.

One presumes that for a luxury car manufacturer, business comes in from the metros. What about Tier II and III cities? Are these showrooms profitable?

Our approach has been clear, as we move into Tier II and III cities; it’s jointly with our existing partners. That has worked well.

Of the €30 million committed to be invested in India in 2007, how much have you spent? How much are you planning to invest further?

In general, we don’t talk about investment in products. But last year, 92 per cent of our models were produced locally in Aurangabad.

Normally, we bring in models on a full-imported basis for the start, but then start assembling here. We expect to launch A3 (sedan) this year, we have already launched RS7 (sports) and A8 (sedan). There are some more surprises in store. India is a young market, but to put that in context, it is only the second country in Asia where we hold the number one position.

Have you been trying to tap the engineering talent here to make cars out of India?

India is a technical reference market. There are a lot of inputs that come in during the development of models, but everything is done in Germany.

Of course, there are challenges, but India is very much a focus market for Audi AG worldwide. We regularly update the board on what is happening in India.

From a cost point of view, would it not be cheaper to do research and engineering here, rather than take something from Germany?

In general, Audi produces car for the world. We take inputs from key focused markets, but the focus would still be German engineering. Certainly, there are no plans to build a local Audi.

How much localisation is happening right now? What more models do we see being assembled from India?

At present, we do A4 and A6 (sedans), Q3, Q5, Q7 (SUVs), and with the A3 coming on board, that percentage will grow and volumes will grow. Everything has to have a business case behind.

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