Audi is building up a roster of famous customers, from Spain's King Juan Carlos to musician k.d. lang. It's also luring buyers from rival German auto makers. Bernd Pooch, chief executive of a Berlin machine tool maker, was a diehard BMW fan. But last November, turned off by the avant-garde styling of the latest 7 Series, the 64-year-old test-drove a $100,000, 275-horsepower Audi Quattro A8. Smitten by the smooth handling and finely crafted interior, he quickly signed a lease. "It's a dream of a car," he says. "People just don't know how good Audi really is."
Winning a spot in the club, though, is just the first lap of a long race. Audi now must strengthen global sales outside Europe, upgrade the struggling U.S. operations, and add new models to match the depth of BMW and Mercedes offerings. Winterkorn also must make sure that the models coming off the production line make a quantum leap in long-term reliability. Like its German rivals, Audi's cars have been plagued since the late 1990s with electronic glitches as auto makers stuffed more and more microchips into their vehicles. Now, Audi and its rivals are staffing up with electronics experts and redoubling efforts to eradicate software snafus before cars arrive in showrooms. Reliability "has been our Achilles' heel," says Marc Trahan, Audi of America's quality director.
Audi also has a long way to go to match the revenue and profit horsepower of Mercedes and BMW. Last year, Audi clocked sales of 779,000 cars, but Mercedes and BMW sold more than 1.2 million each. By revenues, Audi is still only 55% the size of BMW and 48% that of Mercedes-Benz. Audi's profits are a fraction of its rivals' income, too, since it has fewer expensive models on the market.
Full article here
Thanks to SC for the tip.