FAW and Audi Restructure Business and Establish Separation of Production and Marketing Audi Wants to Challenge Tesla

FAW and Audi Restructure Business and Establish Separation of Production and Marketing Audi Wants to Challenge Tesla
03:25, March 9, 2018 Securities Daily

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Audi and FAW set up the second joint venture to fundamentally restructure their business in China

Audi executives first entered SAIC Volkswagen SAIC Audi project or accelerated landing

   FAW and Audi reorganize business, establish separation of production and sales, Audi push pure electric SUV challenge Tesla

■ Our reporter Gong Mengze

When Volkswagen beat Toyota with sales performance of 10.31 million vehicles, the Chinese market contributed nearly 40% of the assists. So Hazeman, President and CEO of Volkswagen Group (China), admitted that "for Volkswagen Group, China is another local market".

The importance of the Chinese market for Volkswagen is self-evident, and domestic consumers are also very concerned about Volkswagen's future model layout and strategic development in China. Recently, the reporter of Securities Daily interviewed the chairman of the board of directors of Audi, Stede, on new energy vehicles, cooperation between Audi and SAIC, and the establishment of a new joint venture between FAW and Audi.

Steiner said that the growth of the domestic high-end car market is expected, and there is still an upward growth potential of 15%. Audi has almost completed the most difficult scientific research and research projects in the group. Audi's slogan is technology leadership, and it will still strive to be the innovation leader of the group and even the industry in the future.

Speaking of joint venture partners in China, Stede stressed that it is not a vital node now. Audi's actions are intended to actively improve its ability to cope with competition.

   Luxury car market has great potential

   Pure electric SUV challenges Tesla

I National New Energy The popularity of the market is self-evident. However, in the segment of mid end and luxury new energy vehicles, brands other than Tesla are weak. At the just opened 2018 Geneva Auto Show, traditional luxury car brands have successively released pure electric mass production models, which officially sounded the counter call, including Audi e-tron.

According to the reporter, Audi e-tron, as the first of the three pure electric vehicles of Audi before 2020, confirmed that it will be built on the platform of Mission E, a pure electric car that will be mass produced by Porsche in the future. The reason why Audi chose to release it in 2018 is that its battery technology is mature enough, which will bring the e-tron SUV a maximum range of more than 500km.

Mortens, director of technology research and development of Audi, told reporters that Audi e-tron not only achieved 100% electrification, but also has the most advanced technology so far, which is superior to Tesla in connectivity, interoperability and initiative. "It's time for Tesla to pack up and cheer up. They have finally welcomed a real challenger."

According to the data, Audi e-tron has a fast charging mode. It only takes 4.6 seconds to accelerate 100 km, and the maximum speed can reach 210 km/h, which is between Audi Q5 and Q7. At present, Audi has exceeded 5000 orders in the Norwegian market alone.

In fact, among the newly established automobile enterprises that have emerged in recent years, in order to improve their competitiveness, they will choose partners in the travel field through cooperation or in-depth investment. For example, Weilai Automobile and China Southern Power Grid, Weima Automobile invested in sharing the Hellobike rechargeable bicycle, and even Mercedes Benz began to look for start-ups related to travel in China to invest and cooperate.

In this regard, Audi seems confident and determined. Steider said that because of its large-scale platform advantages, Audi can ensure that the entire system of customers can be absorbed into its own domain and compatible. "When the customer finds us, we can transplant his ecosystem to our platform. Of course, we still need to further contact with Chinese partners in the future."

   Refined management of separation of production and marketing

   FAW and Audi set up two new companies

Recently, when asked about the progress of the project, Heizman explained in detail the whole process of sending Audi executives to SAIC Volkswagen, which was interpreted by the media as aimed at accelerating the SAIC Audi project.  

At the same time, in terms of FAW Audi, Audi has also acted frequently to further deepen its strategic cooperation with the original joint venture partner FAW. On March 7, Audi and FAW Group further implemented the important steps of their 10-year business plan in China and signed a memorandum of understanding on the establishment of two new companies, which will focus on sales business, mobile travel and digital services respectively. Both parties fundamentally reorganized their business in China.

In fact, for Audi, which has been rooted in China for 30 years, the "North South Project" promoted at the same time is unprecedented. Audi seems to be increasingly pushing the "double track strategy" to the deepwater area. The reporter noticed that the two memorandums were intended to deepen the cooperation between Audi and FAW once again, and fundamentally reorganize Audi's business in China; Among them, new joint ventures focus on mobile travel and digital services. It is expected that by the end of 2018, these two new companies will start operations.

In this regard, Wei Yongxin, general manager of Audi China, said: "After the establishment of an independent FAW Audi sales company, we can start our large-scale product plans under the best conditions with a faster decision-making process." In the future, Audi and its partner FAW Volkswagen will continue to expand their product portfolio in China, introducing more imported models and locally produced models. In the next five years, the plan will include manufacturing four pure electric vehicles in China.  

The establishment of the new sales joint venture will bring about changes in the roles and functional positioning of both parties. An insider told the reporter that after the transfer of main functions such as marketing and sales, the new sales company, as a wholly-owned subsidiary of FAW Volkswagen, will have personnel, finance, procurement and other functions, while FAW Audi will become a pure production joint venture company. It is expected that the construction and implementation of Audi's sales and marketing system will be more simple and efficient in the future.

Editor in charge: Li Jian SF163

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