“MARKETING REPORT: AUDI A.G”

PROJECT REPORT

On

AUDI A.G

EXECUTIVE SUMMARY

This report is presented upon Audi A.G, which is one of the largest luxury automobile manufacturers in the world. Audi A.G is based in Germany and is a wholly owned subsidiary of Volkswagen A.G. The company has grown from a small automobile union of Germany to a key player of the global luxury automobile industry and one of the most admired brands in the market due to its beautiful design and innovation present in its entire fleet of cars.

In this project a great emphasis have been laid upon the performance of the Audi brand in the Indian luxury car market and the various marketing strategies adopted by it to increase sales. In March 2007, Audi set up its own sales company for India. By establishing Audi India as a Division of Volkswagen Group Sales India Pvt. Ltd. in Mumbai, Audi is making a clear long- term statement in the country with ambitious growths plans .With the growth of the Indian car market, the success of Audi India, the maker of fine cars has also been growing. Audi has received an overwhelming response from the Indian consumer ever since its inception.

The group members enhanced their report making experience by visiting the Audi showroom in Gurgaon and having an interaction with the sales representatives who provided them with an insight about the product lineup and various marketing strategies adopted to increase customer base and boost sales.

Audi is always one step higher when it comes to alluring the Indian car buyers. Its leading-edge technology and efficient cars add greater number to the already high sales figures.

Believing in the core brand value 'Vorsprung durch Technik', Audi looks at growing as the unbeaten premium brand in India in the coming years.

Table of Content

S. no. Contents Page no1 Introduction about the Company 32 History 43 About Audi India 44 Product Profile 65 Corporate Social Responsibility 86 Conclusion 87 Recommendations 98 References 9

Introduction about the company

Company Profile

Audi AG

Type Private company, subsidiary of Volkswagen GroupIndustry Automotive industryFounded Zwickau, Germany(16 July 1909)

Founder(s) August HorchHeadquarters Ingolstadt, Germany

Number of locations Production locations:Germany: Ingolstadt & Neckarsulm

Hungary: GyorBelgium: BrusselsChina: ChangchunIndia: Aurangabad

Area served WorldwideKey people Rupert Staler

Chairman of the Board of Management,Martin Winterport

Chairman of the Supervisory Board (Volkswagen AG)Products Automobiles, Engines

Subsidiaries Quattro GmbH,Lamborghini Spa.,

Audi Hungarian Motor KftWebsite www.audi.com

HISTORY

AUDI AG is a German car manufacturer which produces cars under the Audi brand. The name Audi is based on a Latin translation of the last name of the founder August "Horch", itself the German word for “hear." Another explanation for the origin of the name is as an acronym for “Auto Union Deutschland Ingolstadt." The company is headquartered in Ingolstadt, Germany, and has been a wholly owned (99.55%) subsidiary of Volkswagen AG since 1966.

ABOUT AUDI INDIA

As a manufacturer of high-quality and innovative luxury cars, Audi is one of the world’s leading premium brands and is among the most admired on the world market. The basis of its success comprises pioneering concepts in the domains of advanced technology and design.

Audi is represented in 110 countries worldwide and since 2004; Audi has been selling its products on the Indian market.

In March 2007, Audi set up its own sales company for India. By establishing Audi India as a Division of Volkswagen Group Sales India Pvt. Ltd. in Mumbai, Audi is making a clear long- term statement in the country with ambitious growths plans. Audi’s goal is to become the leading automobile luxury brand in the Indian market in the next few years.

The Audi India strategy encompasses significant investments in branding, marketing, exclusive dealerships and after sales service for the upcoming years.

At present, Audi is assembling the Audi A6 and the Audi A4 for the Indian market in Aurangabad.

Audi Car Market in India

With the growth of the Indian car market, the success of Audi India, the maker of fine cars has also been growing. Audi has received an overwhelming response from the Indian consumer ever since its inception. Till date, Audi India has been commended with five awards for its chic, luxurious and efficient cars.

The sales figures for Audi in India have also been climbing higher and higher by the day. Two years ago itself, when recession had severely hit the car market, Audi had seen a three-fold rise. The car maker had sold off 1,050 units in 2008 much higher compared to 349 units that were sold in 2007. The Indian sales

volumes increased by 201 per cent. In spite of the unfavorable market situation, Audi India has recorded great sales figures up by up to 230 per cent.

In April, 2010, Audi India reported a 69 per cent jump in its sales at 189 units as against the 112 units sold during the same period a year ago. This year, the car maker looks at continuing to focus on improving its customer service by bringing in new cars to India and also by offer superior standards of service. However, the April figures sales already speak of the confidence that Indian car buyers have in the luxury brand.

What makes Audi among the top in the Indian car industry? An athletic character, high-tech engineering, and modern designs are carried in all Audi cars sold in India. The Audi A3, A4, A6, and A8 have their own marketplace within India. With the impressive dealer network in India, Audi has been successfully leaving its footprints in every nook and corner of India since 2004. The tempting good looks, gratifying complexity, and revolutionary technology in Audi cars attracts the rich and famous Indian buyers to its showrooms.

The Audi model range in India comprises the Audi A4, A6, A8, Q5, Q7, TT, and the R8. Audi has in it the DNA of a winner and the booking of its cars even before their official launch in India stands as enough proof for the same. Audi is always one step higher when it comes to alluring the Indian car buyers. Its leading-edge technology and efficient cars add greater number to the already high sales figures.

Believing in the core brand value 'Vorsprung durch Technik', Audi looks at growing as the unbeaten premium brand in India in the coming years. It is believed that Audi India will be investing as much as Rs 192 Crore for production of cars in India over the next 3 years. It has already begun assembly of its cars within the country starting with the A6 being assembled at Aurangabad in Maharashtra, India.

Audi cars have lived up to the expectations of the Indian market and have also been accepted enthusiastically by consumers, thus fuelling it to drive speedily towards the sphere of success.

German luxury auto manufacturer Audi registered 78.57% impressive increase in sales for the February month in India selling 450 units as against to last year with only 252 units.

Audi India is rapidly flourishing and had recently made an expansion of its portfolio with the introduction of its flagship models like the Audi A8 L and the super sports car Audi R8 V10; the units are now available in showrooms across India.

Audi is planning to introduce more such luxury models in India this year like the Audi A6 and the Audi A7. The brand owns a good dealership network in the country along with the opening of their Chennai and Delhi showrooms this year. Currently Audi already owns outlets in Ahmedabad, Bengaluru, Chandigarh, Gurgaon, Hyderabad, Jaipur, Kochi, Kolkata, Ludhiana, Mumbai and Pune.

Audi posted a solid half yearly sales performance with 2802 cars delivered in India from January - June 2011, marginally short of its 2010 annual sale of 3003 cars, a growth of 100 percent over the same period

last year (Jan – June 2010: 1400 cars).  The luxury carmaker’s sale in June 2011 stood at 408 cars, a growth of 75 percent. (June 2010: 233 cars)“Given our outstanding performance in the first six months of the year, we will soon surpass our 2010 annual sale of 3003 cars. Audi India’s growth momentum is testimony to the overwhelming response received from our customers, who truly appreciate the progressive design, exceptional service standards and cutting – edge technology that Audi offers. We further strengthened our dealer network with the opening of a new Audi showroom in Ludhiana recently and have planned for more developments on this front later this year,” said Michael Perschke, Head, Audi India.

The various reasons for the growth of the luxury car market in India are:

The economy is rising in the country that has given the people more disposable income, which they are spending in buying luxury cars.

With the IT boom in the country many youngsters are earning high pay packages, which enable them to buy luxury cars. And this have further given boost to the market of luxury car in India.

The government have formulated many polices such as the relaxation of equity regulations and the reduction of import tariffs pertaining to the automobile industry. These have helped to reduce the prices of the luxury cars, which in turn have led to the growth of the luxury car market in India.

The automobile manufacturers and the financial institutions have launched various loan schemes. This has made it very easy for the people to buy luxury cars and this has boosted the luxury car market in India.

PRODUCT PROFILE

Audi sells seven different types of models in India i.e. A4, A6, A8, Q5, Q7, TT, R8.

Audi A4:The Audi A4 is a compact executive car produced by the German car manufacturer Audi AG since late 1994. The initial generation A4 succeeded the four previous generations of the Audi 80. And just like its Audi 80 predecessor, the Audi A4 automobile layout consists of a longitudinally orientated engine at the front, with transaxle-type transmissions mounted immediately to the rear of the engine, again, orientated longitudinally. Drive output is transmitted to either the front wheels, or, utilising Audi's 'trademark' Quattro permanent four-wheel drive system via a Torsen centre differential.

Audi A6:The Audi A6 is an executive car produced by the German automaker Audi. It is available in both saloon, and Avant (Audi's term for an estate) body styles. All generations of the A6, were available as either front-wheel drive, or with Audi's trademark Torsen-based Quattro permanent four-wheel drive (4WD) system. The second and third generation A6 were also used as the basis for the "Audi all road Quattro" and "A6 all road Quattro" models respectively.

Audi A8:The Audi A8 is a four-door four/five-seat large luxury car built by the German automaker Audi, to replace the Audi V8 as its flagship model. First brought to the market in 1994, most versions of the A8 have featured Audi's 'trademark' Quattro permanent four-wheel drive as standard, as well as a multitronic or tiptronic automatic transmissions. Two generations of the A8 have been produced, in both short and long wheelbase form, and are built on successions of the Volkswagen Group D platform series.

Audi Q5:The Audi Q5 is a compact crossover SUV which was released by German automaker Audi for the 2009 model year. It is built using the new Audi MLP platform (Modular Longitudinal Platform) which debuted in the 2007 Audi A5 coupé. The Q5 is the second Audi model in the "Q" range, after the full-size Q7. The Q5 slots above the future Q3, which will be based on the Volkswagen Tiguan.

Audi Q7:

The Audi Q7 is a full-size luxury crossover SUV produced by German automaker Audi since it’s unveiling at the Los Angeles Auto Show in January 2006. In its name Q7, the "Q" denotes a new family of vehicles for Audi, and the designation "7" marks its placement between the A6 and A8 in Audi's model range.

Audi R8:The Audi R8 is a sports car with a longitudinally mounted mid-engine, and uses Audi's 'trademark' Quattro permanent four-wheel drive system. It was introduced by the German automaker Audi AG in 2006. The car was exclusively designed, developed, and manufactured by Audi AG's high performance private subsidiary company, Quattro GmbH, and is derived from the Lamborghini Gallardo. The fundamental construction of the R8 is based on the "Audi Space Frame", and uses an aluminium monologue which is built around a space frame. The car is built by Quattro GmbH in a newly renovated factory at Audi's 'aluminium site' at Neckarsulm in Germany. In 2005, Audi announced that the name of the successful Audi R8 race car would be used for a new road car in 2007, the Audi R8, based on the Audi Le Mans Quattro concept car, appearing at the 2003 International Geneva Motor Show, and 2003 Frankfurt International Motor Show. The R8 road car was officially launched at the Paris Auto Show on 30

September 2006. There was some confusion with the name, which the car shares with the 24 Hours of Le Mans winning R8 Le Mans Prototype (LMP), and also the 1989 Mk2 Rover 200, codenamed R8.

Audi TT:The Audi TT is a sports car manufactured by German automaker Audi AG since 1998 in Gyor’s, Hungary. It is now in its second generation — and available as a 2+2 coupé or two-seater roadster. The development of the Audi TT began in September 1994 at the Audi Design Centre in California. The TT was first shown as a concept car at the 1995 Frankfurt Motor Show. The design is credited to J Mays and Freeman Thomas, with Martin Smith and Romulus Roost contributing to the award winning interior design. A previously unused laser welding adaptation which enabled Qseamless design features on the first-generation TT also delayed its introduction. Audi did not initially offer an automatic transmission option for the TT. A Direct-Shift Gearbox (DSG) became available, the first for a production car, in 2003.

CORPORATE SOCIAL RESPONSIBILITY OF AUDI

Audi is also taking on an important social responsibility, for both the region and the workforce. The Company provides approximately 1,500 jobs at the plant, including 700 newly created positions. Special emphasis was placed on training the workforce. All staff have completed a 176-hour program designed specifically for the Q3 to prepare them for the challenges they will be faced with on the production line.

A long tradition of environmental protection - Audi’s declared objective is to offer each and every customer driving pleasure and sustainable mobility. Their achievements speak for themselves – sportiness, emotional design, quality and environmental awareness all find a common form of expression in the brand with the four rings. Environmental protection enjoys a long tradition at Audi. A tradition that Audi pass on to our customers: with cars that help to protect the environment thanks to their innovative technology. Through economical fuel consumption, a long service life and the use of eco-friendly materials. Without the customer having to forfeit performance, comfort or safety.

CONCLUSION

This report an effort was made to study the brand value of Audi in international as well as the Indian market.This report gives us an insight about the marketing strategy of Audi AG which have transformed it from a small auto union in Germany to one of the largest luxury automobile manufacturer in the world. This report largely

concentrates upon the development of Audi brand in the Indian subcontinent where it is a major player in the luxury car market.

RECOMMENDATIONS

Recommendations to Audi AG:Audi AG should conduct mass promotional activity when it’s entering a new market likeIndia. Its not that Audi has the potential customers only in Tier I and Tier II cities, people from the remote places of India are also buying luxury cars, even though the number is small. It should also carry out joint marketing activities with their exclusive dealer.Audi should launch more sports cars or coupe/roadsters in India as the number of young population is more and youths mostly prefer Coupe/Roadster.

REFERENCES

Books:

Dr. D.D Sharma, Marketing Research Principles Applications and Cases,1999, second revised edition, New Delhi, Sultan Chand & SonsDonald S. Tull & Del I Hawkins, Marketing Research, 1997, sixth edition, New Delhi, Prentice-Hall of India

Magazines:Auto India - Car & Bike MagazineOverdrive - Car & Bike MagazineBusiness Today

Websites:www.audi.inwww.managementparadise.comwww.wikipedia.comwww.google.comwww.team-bhp.comwww.indiaautomotive.netwww.siamindia.comwww.cartradeindia.com