Audi Sees Upmarket Opening in Besieged Russia Market

ST. PETERSBURG – Banking on the luxury segment to hold its own in Russia’s embattled car market, Audi plans to grow sales in the country.

Achim Saurer, the recently appointed head of Audi Russia, says the low- and mid-priced segments of the Russian market will bear the brunt of what is projected to be a 30% year-on-year decline in sales this year, creating a measure of opportunity for higher-end brands.

Audi anticipates its share of the Russian market will rise to between 2% and 2.5% this year, not only through increased sales but also because of the market’s overall decline.

Axel Strotbek, an Audi board member, says the Volkswagen-owned luxury marque looks to connect more closely with the local market and customers. Part of the plan calls for Audi to more actively promote models including the Q7 CUV and A6 and A8 sedans, for which demand remains stable despite Russia’s current economic crisis.

The automaker also will focus on imports and continue curtailing local output. Russian production was reduced at the beginning of the year as both sales and the value of the ruble continued falling as Western economic sanctions remained in effect.

Audi says it has no current plans to resume SKD assembly of its Q5 and Q7 CUVs and A7 hatchback at the VW plant in Kaluga. The 5-year-old facility continues building A6 and A8 models, which remain in high demand mainly by Russian officials and state agencies.

Prices for Audi cars in Russia have increased almost 25% since November. Sales in 2014 fell 5.9% from prior-year to 34,014 units, but tumbled 42.2% in April and 31% year-to-date, according to WardsAuto data.

Russia vehicle sales totaled 139,456 units in April, down 41.4% vs. year-ago, according to WardsAuto data. Sales through April totaled 540,425 units, down 37.4% over like-2014.

Audi says it will not cut prices for its middle range of vehicles, particularly A1 and A3 models.