Automotive News Europe - October 2019 - 10

AUTOMOTIVE NEWS EUROPE

Q&A

QA Off and running

Audi CEO Schot bullish as transformation plan brings first benefits

udi in May outlined a strategy focused
on sustainability that includes having
30 models with electrified drivetrains, of
which 20 will be full-electric, by 2025.
Audi has earmarked 14 billion euros toward electric mobility, digitalization and
autonomous driving and a total of 40 billion euros toward improving its standing
in the ultra-competitive premium sector,
where it trails Mercedes-Benz and BMW
in global sales. CEO Bram Schot, however, said he's more focused on profit margins than volumes. He discussed this and
more with Automotive News Europe Associate Publisher and Editor Luca Ciferri
and Correspondent Christiaan Hetzner at
the Frankfurt auto show last month.

driving EVs every day is extremely positive. The majority of them say they are
hooked on electric now. Therefore, we
need to create more opportunities for
them to test electric cars.

Meet the boss

What will be the biggest challenge
that Audi faces next year?
It's a combination of two things, markets
and investments. Next year will remain
challenging on the markets side, including in China, but we are slightly optimistic on the outlook for the premium segment there. In general, we do not see the
main markets growing, with price pressure challenging our premium business.
We foresee Europe being stable, but the
quality of sales has already deteriorated
a little bit. We anticipate a lot of pressure
in the U.S., where we would be happy
to see a stable market. Therefore, if you
want to improve your results and market
situation, it will be even more important
to improve your own performance.

transformation plan. Our operating return on sales is about 8 percent and that
looks much better than our competition.
If you start making your company less
dependent on volume and get more out
of lower costs and improved flexibility
then you can start growing your brand.

What is the challenge on investments
for e-mobility?
We will be investing 14 billion euros in
select future-focused areas as part of
our current five-year plan. That's a lot.
And our total investment during the period [which runs through 2023] will be
40 billion euros. That has to be financed.
With flat markets, growth won't come
from higher volumes, it has to come
from improving performance. Getting
the right margin is the real issue.

What is your biggest challenge on the
investment side?
Finding the right balance on where we
put our money to achieve the maximum
impact. How do we split our investments
in full-electric cars and plug-in hybrids?
How do we tackle autonomous driving
and shared mobility on the investment
side? This is really challenging as all
these business models are linked and
we have to take into account various external factors such as infrastructure.

How will you achieve this?
We are encouraged because we have
seen the first positive results from our

What is the toughest part of getting customers to consider electric vehicles?
The feedback we get from customers

www.autonewseurope.com

❚ NAME: Bram Schot
❚ TITLE: Audi CEO
❚ AGE: 58
❚ MAIN CHALLENGE:

Improving Audi's results
despite volatile markets and
huge investments.

Is the recharging infrastructure still
an issue in Europe?
Yes. Electric mobility has to become suitable for everyday use. That is why we offer
our e-tron customers the e-tron Charging
Service. They have access to more than
110,000 charging points throughout
20 European countries. At the same time,
it is crucial that the overall availability of
charging points has to be scaled. Only
then will e-mobility spread.
ACEA Chairman Carlos Tavares says
he believes Brussels is listening to
automakers but it isn't hearing the
message. Would you agree?
Clearly, there could be more done in some
areas, but I'm not pointing fingers. We, as
the automotive sector, also have to do
our homework. And we are not done yet.
At the same time, we can see what the
Netherlands has done - and being Dutch,
I'm proud to praise my country. When you
see the number of charging points in the
Netherlands compared with, for example,
Germany, you see that creating a charging infrastructure is fundamental.
How did the Netherlands achieve this?
Authorities wanted to get people to make
a change so trades-offs were created.
This shows the move to electrification can
work. There is money to be made there.
There is a business model. And everyone
was well aware that this would only work
if there was an adequate infrastructure to
recharge the cars. I think that the Dutch as
well as the Norwegians and other Scandinavian countries, for example, have done
a very good job.
By 2025 Audi plans to have 20 fullelectric and 10 plug-in hybrid models.
How will that affect your overall sales?
We expect to have electrified models account for 40 percent of our global sales
in 2025. ANE

OCTOBER 2019

http://www.autonewseurope.com

Automotive News Europe - October 2019

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