Audi to Offer $285,000 Special Edition ‘Halo’ Models to Boost Exclusivity
Audi AG (NSU) will roll out two limited edition models in coming months as part of an effort to increase the brand’s exclusivity and better compete with Bayerische Motoren Werke AG (BMW) at the high end of the luxury market.
The Volkswagen AG (VOW) unit will introduce a Q7 sport-utility vehicle next month in Russia with a two-tone exterior costing 200,000 euros ($285,000), sales chief Peter Schwarzenbauer said. Audi will begin selling the R8 V10 Pure Sport in the United Arab Emirates for 500,000 dirhams ($136,000) in June.
“There’s nothing better than tailoring cars to specific markets,” Schwarzenbauer said in an interview. “We see huge potential for business with limited special editions.”
To churn out more market-exclusive models and made-to-order vehicles, which typically have better profit margins, Audi is revamping its high-performance Quattro unit. The division, named after Audi’s pioneering four-wheel drive technology, is also responsible for Audi’s merchandising efforts to sell products with the carmaker’s name and logo.
Audi aims to double the share of customized vehicles to 20 percent of global sales by 2015, when it vows to dethrone BMW as the largest luxury-car maker, Schwarzenbauer said. The VW unit is also considering special editions for the U.K. and U.S.
“These halo cars enable a brand to feature new designs and engineering and show the best of its talents,” said Kevin Tynan, an automotive analyst at Bloomberg Industries. “The motivation is to draw traffic to the showrooms.”
The offerings for Russia and the U.A.E. follow Audi’s successful sale last year of 450 of the Black-and-White edition TT sports car, priced at 54,000 euros, to Chinese customers.
“The cars were still traveling on a vessel to China when we sold the last one,” Schwarzenbauer said in a telephone interview April 1. “It was a test case convincing us that limited editions can be extremely successful.”
BMW has been pushing out country-specific editions for many years “as a strategic tool” to spur sales in specific markets, spokesman Stefan Behr said. Examples in 2010 include the 7- Series Expo Shanghai edition and the M3 Tiger Edition for China, as well as the 7-Series 40th Anniversary model developed for Oman, Behr said.
Mercedes-Benz, Daimler AG (DAI)’s luxury brand, uses special editions of regular models to emphasize a car’s performance traits, spokeswoman Verena Mueller said in an e-mailed statement. Special series include an Edition One of the SLK hard-top roadster in Glacier Grey, according to Mueller.
“Special editions get customers to notice a brand they haven’t considered before,” said Stefan Bratzel, director of the Center of Automotive Management at the University of Applied Sciences in Bergisch-Gladbach, Germany. “They’re an effective technique to penetrate new markets.”
Audi will limit the Q7 V12 for Russia to 555 cars, which will have a two-tone Phantom Black and Black Velvet exterior, Schwarzenbauer said. It’s the first time the SUV is being offered with a two-color exterior. The cost is also double the normal price of the vehicle in the Russian market.
The Ingolstadt, Germany-based automaker will only make 40 of the R8 V10 Pure Sport car. A limited edition of the R8, which the Quattro unit builds in Neckarsulm, Germany, for the U.K. is also under discussion, spokeswoman Esther Bahne said. The division just began selling the R8 GT special edition and the RS3 Sportback model.
“The Quattro division is like a rough diamond,” Schwarzenbauer said. “We’re just at the beginning of reaping its vast potential.”
Audi plans to spend 11.6 billion euros on new plants, products and technologies through 2015, with about half the amount earmarked for its two main German factories. Audi is enhancing the high end of its 37-model lineup as well, introducing a revamped A6 sedan this month, after the new A7 Sportback and an updated A8 sedan last year.
The German carmaker aims to increase 2011 sales worldwide by more than 10 percent to over 1.2 million cars and SUVs.
Audi is mulling a limited edition model for the U.S. either in 2012 or 2013 as customers in the world’s largest luxury car market become more inclined to pre-order vehicles instead of buying them directly off the lot, Schwarzenbauer said.
Customers in the U.S., where the VW unit has a goal of doubling deliveries to 200,000 cars and SUVs by 2018, can choose colors, fabrics and customized interiors under its “exclusive” program.
The share of built-to-order vehicles of Audi’s U.S. sales rose to an all-time high of 25 percent last month from 5.4 percent in 2009, he said. Audi is targeting a level of about 20 percent for sales of vehicles customized through the Quattro division over the medium term.
“The car buying process in the U.S. is evidently changing,” Schwarzenbauer said. “People are now requesting more individualized options.”
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