Audi’s rebrand in China points to bigger changes in the auto industry

It is also a rejiggering for the German car manufacturer, which entered China in the late 1980s and became, thanks to a collaboration with domestic manufacturer FAW, the first global premium brand to adapt its cars to the Chinese market. For many years, the Audi was synonymous with foreign luxury and later became the standard vehicle party elite.

But the rapid rise of Chinese automakers, backed by generous state support and a new middle class, has left global automakers playing catch-up. Mitsubishi stop production in China last year; Hyundai and Ford have closed o reduced operations in factories. This month, General Motors said its China business, operated jointly with several Chinese automakers, has seen sales drop nearly 20 percent this year. GM he said will restructure its business in the country, taking a $5 billion write-down in the process.

The Volkswagen Group, which sells Audis as well as Porsches, Bentleys, Škodas and Lamborghinis in China, has seen a 10 percent drop in vehicles sold in the country this year. U drop was responsiblein part, due to the retraction of global sales that led to a fall in profits last quarter. Volkswagen said last week would sell a plant in Xinjiang.

However, as Ahuja points out, Audi has sold more than 9 million vehicles in China. He wants to stay in the country. AUDI-without rings!-It is an attempt to do so. (Perhaps confusingly, the automaker will continue to sell cars in China even under the heritage “four rings” brand.) “I don’t want to touch that legacy,” says Ahuja. “I want to evolve further.”

The brand tweaking also points to a deeper dynamic in the Chinese market, where global automakers well beyond Audi (or AUDI) are striving to maintain an edge among a new generation of car buyers as the Chinese-made cars are sold at home and abroad. And it indicates the dynamics of change in consumer preferences that have already appeared on the roads well outside the Asian country.

Back in 2019, BMW defended its decision to go big with its 7 Series kidney grilles. At the time, BMW Group Design Director Adrian von Hooydonk cited a reason for the huge, imposing front ends was a “younger and more outgoing” customer from China. He also went on to say that the the grids would retreat such as “I heard from (BMW’s Shanghai Design Center) that design tastes in China are developing rapidly … calling for more and more subtlety.”

Brand translations

For one, Audi’s decision to ditch the four rings is practical. Logos like Audi’s four rings “are very difficult to defend in China, from an intellectual property perspective,” says Jeff Lee, co-founder and partner at Northern Light Venture Capital, an early-stage Chinese firm with offices in Silicon Valley. easy to use five rings or three rings And then there are hundreds of Chinese manufacturers. It helps that “AUDI” is easy to pronounce for Chinese speakers.

The old and the new.

Courtesy of Audi