Audi Chief Ponders Lineup Expansion, Sales Growth

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New York Int’l Auto Show

NEW YORK – Things are literally looking up at Audi of America Inc. as the brand’s U.S. chief executive covets new high-end luxury-market entries and continued overall sales growth.

While Johan de Nysschen says he is content with the breadth of Audi’s current portfolio here, he would like to expand the brand’s high-end offerings because the unfavorable euro-dollar exchange rate hurts profitability on vehicles such as the entry-level A3 sport hatch.

Audi Q7 CUV gets 3.0L diesel engine next year.

“We have not supported the car with lease programs,” de Nysschen tells Ward’s at the New York International Auto Show. “We don’t lose money on it, but the margin is thin because the cost of producing the A3 is high.”

He says Audi will have a sufficient number of models after it introduces the Q5 small cross/utility vehicle next year, which will compete against the BMW X3, Lexus RX 350, Infiniti EX35 and the Mercedes GLK.

“I don’t want to see the day that we have proliferated our brand across so many segments,” de Nysschen says.

He expects a strong sales boost next year when a revamped A4 midsize car is introduced, along with a Q7 CUV powered by a new 3.0L V-6 diesel engine.

The oil-burner will give the Q7 a 20%-25% fuel economy increase says Filip Brabec, general manager-product planning. It will have a 700-mile (1,127-km) cruising range.

Diesel exhaust will be treated with AdBlue, a urea solution that reduces nitrogen oxide emissions.

Brabec says Audi’s AdBlue diesel program is being studied for other vehicles in the brand’s lineup.

“The A4 would be a logical candidate where we could make a big impact,” he says. “It doesn’t exclude other models, there will be more diesels coming from us.”

Audi also is studying a coupe version of the A6, Brabec says. “We have some ideas on the drawing board, but it won’t be available in the next couple of years,” he says.

Meanwhile, Audi sold more than 93,500 vehicles in the U.S. last year – an increase of nearly 4% compared with 2006, according to Ward’s data. But de Nysschen is more concerned about steady growth than breaking the six-figure mark.

“We would like to sell more cars than last year, but breaking the 100,000-unit barrier isn’t a must,” he says. “We’re not optimistic about the car market in general this year.”

De Nysschen also admits Audi still is plagued by a lack of consumer awareness. A Super Bowl ad met with some success.

“We immediately saw a huge increase in showroom traffic,” he says.