SAIC, Audi puzzle: uneven distribution of products, channels fear of infighting

Posted on 11/15/2016 4:06:31 PM

November 14, with the SAIC Group, a paper announcement, SAIC-Audi officially settled. SAIC and Audi from both the "ambiguous" to finalize the two sides of the joint venture rumors people hanging enough appetite. On the one hand, Audi in the FAW-Volkswagen system shares than the limited profit contribution and the right to speak right, need a strong "new patron"; the other hand, SAIC high-end brand camp add a "fierce" Beneficial to the brand to mention, the two sides seem to take the necessary and very "good fit." But just a good achievement for some of the "SAIC-Audi" joint venture prospects will be smooth sailing?
A7, Q2, TT, and A8L and Q7, which A8L and Q7 is to ensure the luxury brand Audi high-end models, the late or still to import the introduction of the way, The only price is relatively "cheap" popular SUV models Audi Q2 is still unknown "Whispering."
SAIC Audi first faced with the problem of product imbalance, such as the public in China, the two joint venture products, Polaris and Sunny, Passat and MAGOTAN, Santana and Jetta, both models are almost the same.But now Audi left SAIC Volkswagen models are relatively more personalized niche products, and FAW-Volkswagen Audi models clearly not the same level of product, sales will not be much help. "Automotive industry consultant Feng Shiming told reporters surging news reporter.
In the joint venture development of foreign-funded enterprises in China, the product line is not enough to support the two joint ventures from the case abound. To the more "extreme" Mazda, for example, the development of serious "lame legs", due to the aging models and the introduction of new models slow, FAW Mazda sales in 2015 almost shrunk to only half of Changan Mazda.
Channel "infighting" intensified
In addition to product distribution, SAIC Audi joint venture "come true", the FAW-Volkswagen Audi dealer is clearly the first "sit still" people. It is understood that FAW-Volkswagen Audi dealers have written a joint letter sent to the Audi, SAIC against the Audi joint venture with the public.
At present, FAW-Volkswagen Audi's dealership has more than 400, and plans to expand to 2017 to 500. As the leading ABB sales in China, Audi in China, the number of outlets compared to Mercedes-Benz and BMW is not too much. But the Audi dealer has obvious pressure library and to fight the "price war" to promote the status of terminal sales. In the FAW-Volkswagen Audi dealer's written letter, said some dealers inventory cycle for up to 2 months, the normal operation of enterprises face a lot of pressure.
"Audi in a second-tier cities, the dealer network has been quite saturated, SAIC Audi, whether the original dealer 'merit' or do a new deployment will have competition with the industry, leading to the two sides together with profit decline. Told the surging news, how to balance the distribution of profits channel is placed in front of the most serious challenges of Audi SAIC.
Surging news to the FAW-Volkswagen Audi dealers in Shanghai learned that, in fact, "joint opposition letter" has not yet officially submitted to seal, is still in the drafting stage. But the dealer and the FAW-Volkswagen does exist representations, at present, dealers are eagerly waiting for FAW-Volkswagen's attitude.
"Auto M & A" editor in chief water Xu said that after the establishment of SAIC in the Audi, the short term must be reached with the original dealer settlement, and to give comfort measures. Or the factory took out some of the money to give the appropriate subsidies to increase rebate, or attract some excellent channel dealers to join SAIC Audi.
"In the long run, the public in China's network structure, the public import dealer models less, the loss is not; and the original Audi dealers imported high profits, but the rise of parallel imports and domestic car pressure, and now life is not easy . "Xu suggested that SAIC-SAIC may be able to use the two existing channels for sales.
In fact, in addition to "Battle" BMW Mercedes-Benz, and now Audi also need part of the "energy" face of second-tier luxury brands and independent high-end brand collective "siege", which will further "squeeze" SAIC Audi's living space.

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