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German luxury car maker, Audi, continues its dual growth strategy riding on petrol and electric cars in India launching a total of nine products till now. Audi believes that 2021 has been a successful year despite semiconductor shortages and post Covid-19 economic slowdown. Balbir Singh Dhillon, Head of Audi India interacted with Livemint and shared the company’s vision of electrification, import duty, price rise and much more. As we discuss, the car maker plans its revamped Audi Q7 2022 for India.

Audi revised the price of its cars in India. The woes kept adding for buyers as the supply chain is already constrained due to semiconductor shortages. How do you plan to address the demand and supply mismatch and rising inputs cost?

We intend to run a sustainable business model. Given that the cost of inputs and operations is rising, some corrections in the vehicle's pricing are necessary. We recently announced a price increase of up to 3 per cent across our entire model range owing to rising input and operational costs – this will come to effect from 01, January 2022.The new prices for select vehicles in our range will solidify our premium price positioning and help achieve sustainable growth for us and our dealer partners. However, as Audi has always focused on customer centricity, we will ensure that the impact of the price hike is as minimal as possible on our customers. The demand-supply mismatch has impacted everyone – the brand, our dealer partners, and the end customers. We are working closely with HQ to address this issue.

How has the transition from diesel/petrol to petrol and EV been for Audi India?

As a brand, our focus continues to be on petrol and electrification. We identified a shift in trend towards petrol early on and the market response has validated our belief. The transition to any strategy take a few years – the response we have received for our petrol models is phenomenal.

Of course, there are a few customers who will still want a diesel car but that is changing very rapidly. As far as EVs are concerned, the response to e-tron, our EV brand has been extremely encouraging and we are more than happy with the EV adoption across the country.

You’ve already launched nine products in India, and the Q7 will be the tenth car from Audi India in 2021. Is it the demand which is pushing you or something else? Tell us about Audi's growth figure this year?

As a brand – we currently sell petrol and electric cars. We have launched 9 new products in the last 11 months and have received an overwhelming response for all products. Of the 9 products launched, 5 have been electric. The e-tron brand has been established well and our cars are receiving a phenomenal response from the customers.

Industry-wise, the luxury car market is showing encouraging signs. It has already improved with the ongoing vaccination drive. A lot of these sales are coming from Tier 2 markets, spread across the country and this will continue to grow. At Audi, we can say with certainty that 2021 has been a successful year.

What would be the new EV range coming from Audi next year? Are you satisfied with the import duty structure in India on EV and luxury cars?

The Audi e-tron GT electric supercar
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The Audi e-tron GT electric supercar

Audi India has launched 5 electric cars in the last 6 months. The Audi e-tron 50, Audi e-tron 55, Audi e-tron Sportback 55, Audi e-tron GT and Audi RS e-tron GT. When we launched our EVs in India - we created an entire ecosystem for our customers. This included sales, after-sales, buyback, charging and overall ownership.

Going by the current traction in the EV segment, we may see volumes of EVs more than tripling or quadrupling albeit on a low base. The direction of volumes and growth is very encouraging. And as a brand, we are moving towards complete electrification by 2033.

Currently, the import duty on fully imported cars ranges from 60-100%, the GST (including cess) ranges from 48-50% on ICE engine cars/ 5% on EVs and the Registration/ Road tax is up to 20% (varies from State to State). This high tax/duty structure and layering of one tax on another make luxury cars very expensive in India. It’s worthwhile to mention that some of the States are also offering lower / NIL registration tax on the EVs. However, a re-look at the current tax structures by the Government will certainly become beneficial for the segment to grow considerably in the future.

What does Audi India plan for the charging infrastructure and your overall investment for the coming days into electric cars?

Considering the traction that the segment has gained, there isn’t a shred of doubt that EVs will pick up pace in the months and years ahead. However, electrification is a long journey, and range anxiety has been a significant challenge, keeping customers apprehensive towards upgrading to EVs.

Robust high-speed charging infrastructure is essential, and to address this, we have opened the Audi EV charging points to vehicles from other manufacturers. All Audi India touch points are equipped with charging points. When we launched our e-tron brand in India – we created an entire ecosystem around the car. Right from knowledge sharing content for customers, to charging infrastructure, buyback, warranty and after-sales – we addressed every critical point.

We are committed to EV’s are currently the only brand in India to offer 5 electric cars in the country.

What does Audi have in store for us after Q7 in the ICE segment?

Audi has started the production of Audi Q7 2022 in India
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Audi has started the production of Audi Q7 2022 in India

At Audi India, we are consistently focusing on building a sustainable and profitable business model. We have charted ‘Strategy 2025’ with a clear roadmap and aims to strengthen the Audi brand in India. It is based on four key pillars - Customer Centricity, Digitalization, Products and Network. Our product plans include a mix of petrol and electric vehicles and you will see a lot more action from the brand in 2022.

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