Driving Today

Audi Considering Expansion in U.S.

Rapid sales growth of Audi brand prompts execs to explore an American factory … or two.

If you haven’t noticed, Audi is on a roll. It set a U.S. record last year with sales of almost 102,000 vehicles, and this year it expects its sales in America to increase by 10 to 20 percent. Amazingly, this is happening in a market that is basically going sideways. The company thinks it can sell 150,000 cars in the United States by 2015, and its major obstacle to achieving that is supply. Audis are selling so well that its dealers don’t have much inventory in reserve. In the most recent report, Audi only has a 21-day supply of vehicles for the American market, while industry experts say a 50- to 60-day supply is ideal.

So it comes as no surprise that Audi is thinking of following rivals Mercedes-Benz and BMW in establishing an American factory. In fact, it might set up two factories: one to build Audis exclusively, the other to build engines and transmissions in conjunction with its sister brand, Volkswagen, which has just established its own American plant. In a report from auto industry trade publication Automotive News, Audi CEO Rupert Stadler is quoted as saying, “It is totally clear that we need new production capacity in the U.S. The question only is when.”

Both Audi and parent Volkswagen Group have ambitious plans for expansion in the U.S. and global markets. VW recently opened a factory in Chattanooga, Tenn., that is building a newly redesigned Passat, which is tailored specifically for American consumers. Audi’s Strategy 2020 Plan calls for the brand to come close to doubling its global sales total by 2020. Unlike other manufacturers who have lowered their sales targets because of the prolonged world economic slump, Audi actually increased its goal by nearly half a million cars in light of continuing robust sales.



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