Story: JOHN GRIFFITHS
Despite the plunging thermometer as Eastern Canada started its descent into sub-zero winter, Martin Sander was not exactly overjoyed to receive the call from his masters at Ingolstadt.
Running Audi’s operations in Canada had been a satisfying affair. Canada tends to mind its own business. Its natural resources-bolstered economy had bumped along better than most through the long night of global fiscal turmoil. In comparison with what was going on south of the Canada-US border, he now concedes, business for a premium-brand company like Audi was actually thriving.
“So a little while back, when I was asked to move to the UK from Canada, I was concerned because, while Canada was booming, in the UK I knew there was a lot of talk about doom and gloom and a possible recession – so I expected a totally different business climate.”
- VW group spent €300 million on the factory that makes the Audi A1, but sales in the UK are still constrained by supply, not demand
He tells the tale to BCM with a grin. He realizes now that he can afford to. Outside the glitzy Cheltenham hotel where he is speaking, colleagues are herding road test hacks into the new, 5-door Audi A1 Sportback, now just going on sale in the UK. The Audi A1, in both 3- and 5-door forms, is giving Sander a problem – but one that most other car makers would envy.
The €300 million Forest factory near Brussels, converted for Audi’s furthest-ever venture downmarket, is churning out A1s as fast as it can –120,000 last year. But, says Sander, it’s not enough. Further growth in the UK’s 2012 sales of A1s – 18,500 last year in the first full year of output – will be reined in by lack of supply, not demand, until substantially higher output can be achieved by Forest.
For Audi the A1 is far from a lone glimmer of light in continuing overall UK market gloom. Sales, says Sander, are rising across virtually the entire Audi range. “What I am actually seeing is that our business is really strong, so that in the first quarter [of 2012] I think we will be significantly up in sales terms over last year. “
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“…we are seeing a very strong order intake across the whole of our range. So everything is looking strong right forward to quarter three.”
He doesn’t care to put firm figures on the prediction. “But more importantly, we are seeing a very strong order intake across the whole of our range. So everything is looking strong right forward to quarter three. In summary, business is much stronger, much more profitable in the whole organisation than maybe all of us had expected a few weeks or months ago. The UK is undoubtedly proving a good place to be.”
The move from Canada no longer provides a cause for regret for the 44-year-old, 18-year veteran of Audi.
“I’m excited to be here in the UK now. The UK is the fourth largest market for Audi in the world in terms of volume, and maybe even more important in terms of profitability. Last year we sold 130,000 cars in the UK and this year we are planning to do significantly more. “
“Over the past 18 years I have been part of one of the most exciting brand stories in our industry, being involved in Audi’s movement from a small company focussed on the German market selling about 13,000 cars to one of the most premium brands in the world. Last year we sold 1.3m cars and if we had not been limited in supply we could have sold more – what a fantastic story and what a fantastic story for me personally.”
Strong demand is one of the factors that contributes to Audi’s excellent residuals and therefore attractive business car leasing rates and favourable company car comparisons.