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Audi explains sales slump: "We're victims of our own success"

Audi boss Paul Sansom insists there are bright days ahead for his company

Audi has shed some light on its torrid start to 2019, pointing to supply issues and delayed launches to explain a slump in deliveries that has seen sales fall by more than 30 per cent so far this year.

We caught up with Audi Australia boss Paul Sansom at the local reveal of the all-new A6 - and the unveiling of the brand's new connected-car multimedia system, Connect Plus - and asked him to dust off his crystal ball for a peek into his brand's future. And that future, he says, is bright, despite sales so far this year falling by some 32 per cent.

Mr Sansom points to delivery issues in Germany, sparked by a near brand-wide switch to Worldwide Harmonised Light Vehicle Test Procedure (WLTP) compliance. The WLTP emissions regulations forced Audi to remove cars from sale to meet requirements, and Mr Sansom says Audi HQ prioritised getting European dealerships re-stocked, pushing back Australian launches. The process was made more complicated by the fact Audi was due to launch new or updated models at the same time.

"The premium end of the market is down 11 per cent, and are a part of that obviously, but it’s largely down to supply due to those WLTP issues," he says.

"We’ve become a victim of our own success. We’ve got so many models in our line-up - we’ve got a great range - and we’re refreshing so many of them at this point in time, and when switching over to WLPT, and that has compounded the issue for Audi perhaps more than some of our competitors."

Audi managed 858 sales in July, versus 1352 in the same month last year (down 36.5 per cent). The year-to-date numbers are no better, with the German brand shifting 8056 vehicles so far this year, compared to 11,976 in 2018 (down 32.7 per cent). To put that into perspective, BMW’s monthly sales increased by 4.5 per cent to 1758 in July, and the brand’s YTD tally is down just 3.1 per cent. Mercedes-Benz sales shot up 25.7 per cent to 2792 sales in July, while its YTD tally is down 9.0 per cent.

But Audi says that, had there been no supply issues, they would have suffered no drop in sales, and would expect to be sitting at close to the brand's 2018 sales figures. Mr Sansom points to the delayed A1 and Q3 as a case in point. 

"(We'd be) probably around about even. The cars we haven’t had on sale represent about a third of where we’d normally be," Mr Sansom says. "But of course it’s not that easy, the market is down, of course, and consumers are tightening their belts in Australia.

"But if we add up the cars we had on sale during the first six months of 2018, it would represent about a third of our volume, and we’re about a third down, so we’d be about on-par.

"The car we’re most missing at the moment is the Q3. We sold out and we anticipated it coming early in 2019, and it’s still a couple of months away.

"We also ran out our very popular Audi A1 much earlier this year, and due to delays it won't arrive for a couple of months yet, so we've had quite a gap."

But it's not all bad news for Audi, with the brand's local boss insisting the company will be "flying" in the second half of 2019, pointing to the Audi A6 and an "avalanche" of new products coming, like the A3, the A5 and the Q5.

"The positive trend is that in the cars we have had available in the market to sell, they've actually been doing very well. The Q2, A3, A4 and A5 have been in good supply this year, and we've been growing our share.

"It's been a tough first half year, yes... but what we are focused on is our growth potential in the second half of the year."

Can Audi push its way back into the winner's circle? Tell us in the comments below.