New Delhi: Luxury car maker Audi AG, a unit of German car maker Volkswagen AG, said on Thursday that it is likely to exceed its sales target in India in 2009. The firm is also considering sourcing components from the country for its global operations.
Audi, which had planned to sell 1,500 cars this calendar year, now says it would be able to sell around 1,700-1,800.
The auto maker may be constrained by production capacity at its German facility from where it imports some cars. “It all depends on how many more cars Germany can produce,” said Benoit Tiers, managing director of Audi India Pvt. Ltd. He was speaking on the sidelines of the launch of a new version of the Q5 sports utility vehicle. The company aims to sell 450 units of the Q7 this year.
Expansion drive: Audi India managing director Benoit Tiers. Ramesh Pathania/Mint
In the first eight months of 2009, Audi sold 1,128 cars, 62% more than the year-ago period.
Audi assembles the A4 and A6 models at its Aurangabad, Maharashtra, factory. It now plans to start assembling the Q5 at that facility from March. India is the only country outside Germany where Audi plans to assemble the Q5. Completely built up units are charged 116% import duty. Assembling cars in the country brings that down to 60%.
Audi has invested €30 million at the Aurangabad facility, which it shares with group company Skoda Auto India Pvt. Ltd. The firm is also working with group company Volkswagen India Finance Pvt. Ltd to introduce financing and insurance options for its cars by December. So far, these have been offered through a tie-up Audi has with Bajaj Allianz General Insurance Co. Ltd.
It also plans to expand its dealerships, taking the total up from 12 to 18 by the end of 2010. The new dealers would be located in Delhi, Chennai, Ludhiana and Kolkata. Mumbai would get a second dealer.
In its first full year of operations in India last year, the company sold 1,050 cars. Tiers declined to provide details on the type of components the Volkswagen group plans to source from India. Audi said its investments in the in the next few years would largely depend on government policies. At present, tax rates in India favour small cars.