Audi targets US luxury market

Audi is setting its sights on a far larger slice of the US luxury car market with a plan to more than double its sales there to 200,000 by 2015.

Volkswagen's premium brand will retool its American dealership network and develop a new smaller sports utility vehicle, the Q5, to raise its game in the world's largest car market, where it is less successful than European rivals such as BMW.

"We are selling 95,000 [vehicles] now. By 2015 we want a doubling of the number," Ralph Weyler, Audi's head of marketing and sales, told the Financial Times.

Audi's ambitious US sales targets dovetail with plans by its parent to close the sales gap with industry leader Toyota by investing in markets and products where its competitors dominate, including in SUVs.

Martin Winterkorn, VW chief executive, wants the group to increase its global sales 10 per cent a year and exceed 8m units by 2010.

Audi speaks of becoming "the most successful premium brand in the world", with 1.5m sales by 2015, although BMW's own unit sales targets are even more ambitious. Audi's newest models are receiving rave reviews in Europe, and in China the brand outsells both BMW and Mercedes.

In the US the brand has underperformed since the 1980s, when reported problems with "unintended acceleration" of one of its cars hit its business.

Mercedes and BMW were quicker to develop SUVs, a popular vehicle format in the US. More recently, Audi has been successful with its Q7 SUV.

Audi planned to increase the quality of its dealers in the US, many of which are "multi-franchise" outfits selling its cars alongside those of other brands, Mr Weyler said.

The brand has about 110 exclusive dealers, and will maintain its focus on large metropolitan areas on the US coasts and cities such as Dallas, Houston and Chicago.

US luxury car sales are proving resilient in spite of recent market volatility linked to the subprime mortgage crisis. BMW, Mercedes, Toyota's Lexus brand and Audi all reported higher sales in the year to August.

Unlike Mercedes and BMW, both of which have factories in the US, Audi had no plans for local production. "At the moment, we don't have adequate volume," Mr Weyler said.

VW is weighing the possibility of building its first US production plant.