Audi has embarked on a sweeping strategy overhaul under CEO Gernot Doellner, aiming to revitalize growth after recent years of sales setbacks and intensifying competitive pressures. At the heart of this revamp lies an ambitious long-term target: selling 2 million cars annually. This figure represents around 20 percent growth from 2024 levels and would mark a record high for the German luxury carmaker. While the company expects to deliver between 1.7 and 1.8 million vehicles in 2025, the larger ambition signals a bold new era for the brand. The new strategy, which is expected to be outlined in greater detail later this year, places particular emphasis on the U.S. market, where Audi aims to nearly double its current sales, and on addressing structural disadvantages that have eroded its competitiveness in recent years.

Audi’s need for a strategic reset has become increasingly evident. The company saw its global sales decline by nearly 12 percent last year, slipping to around 1.67 million units. Several factors contributed to the slump, including repeated delays in new model launches and technical issues that slowed the rollout of critical next-generation vehicles. The brand has also struggled to keep pace with technological advances from rivals, particularly in the shift toward electric mobility. Compounding these challenges, the automaker has been severely impacted by U.S. import tariffs, with duties of 27.5 percent costing it an estimated €600 million in the first half of the year alone. Unlike competitors such as BMW and Mercedes-Benz, which operate major assembly plants in the United States, Audi has no local production footprint to shield it from such financial burdens.

U.S. Market Becomes the Centerpiece

The strategy overhaul now underway under Doellner, who took charge in 2023, is intended to correct this imbalance. The company is signaling that it will not merely seek incremental improvements but a transformative shift in how it approaches growth, competitiveness, and profitability. By anchoring its long-term ambitions around a 2 million-car benchmark, Audi is sending a clear message that it intends to compete aggressively with its German peers and reposition itself as a frontrunner in the global luxury car industry.

Central to this ambition is a sharper focus on the United States, which Audi sees as a key driver of growth. Currently selling around 200,000 cars annually in the market, the brand plans to almost double its presence there. For Audi, this is not just about selling more cars but about securing a stronger foothold in the world’s second-largest automotive market, which continues to expand even as European demand stagnates. Executives view the U.S. as offering untapped potential for luxury sales, especially if Audi can match the localized production models that have benefitted its competitors.

A critical part of the new strategy involves establishing a U.S.-based production facility. The company has for some time weighed the option of building its own factory or using Volkswagen Group’s existing American footprint to produce Audi models. A dedicated plant would allow Audi to bypass steep tariffs, cut freight costs, and reduce delivery timelines, while also positioning it to respond more quickly to changing consumer preferences. Such a site could also serve as an export hub, mirroring the strategy employed by Mercedes-Benz and BMW, whose large U.S. facilities not only supply North America but also ship vehicles globally. A decision on this front is expected to be finalized in the coming months.

Faster Product Launches and Electric Push

Alongside the expansion into U.S. manufacturing, Audi’s strategy emphasizes accelerated model launches. The brand has faced repeated criticism for delays that have slowed its transition to electric vehicles, most notably setbacks in bringing the Q6 e-tron to market. With consumer interest in electric cars surging in many regions, Audi’s ability to deliver compelling EVs in a timely manner is seen as critical to its growth. By streamlining production pipelines and tightening project management, the company hopes to shorten launch cycles and ensure a steadier flow of new products across both its electric and combustion-engine lineups.

Competitors such as BMW and Mercedes have gained ground by bringing a broader electric portfolio to market more quickly. Audi now recognizes the need to catch up, not only with German rivals but also with Tesla in the premium EV segment and Chinese manufacturers that are aggressively entering Europe with competitively priced electric models. Executives believe that refining the company’s EV roadmap is essential to winning over younger, sustainability-focused buyers and ensuring long-term relevance in a market where emissions regulations are tightening.

The Q6 e-tron, built on Volkswagen Group’s Premium Platform Electric (PPE), is expected to serve as a cornerstone of this effort. Audi plans to expand this platform across multiple models, strengthening its electrified lineup and giving it a chance to compete more effectively with rivals. The company is also investing in charging infrastructure partnerships to address consumer concerns about convenience and reliability, while simultaneously working to bring down battery costs through economies of scale.

Trade Pressures and Global Balance

Improving operational efficiency is another key pillar of the revamp. With tariffs and logistical costs eating into profits, Audi is expected to introduce stricter cost controls and more rigorous management of its global manufacturing network. This focus on efficiency will also extend to prioritizing higher-margin vehicles that can sustain profitability even as volumes grow. Balancing the dual goals of scale and profitability is essential if Audi is to achieve its ambitious targets without compromising its premium identity.

The shifting international trade environment also looms large over Audi’s strategy. Recent discussions in Brussels and Washington have raised the possibility of tariff reductions on transatlantic auto trade, though outcomes remain uncertain. For Audi, establishing a U.S. production base offers insurance against such uncertainty, ensuring that it remains competitive regardless of how trade policy evolves. A U.S. factory would not only eliminate exposure to existing tariffs but also strengthen Audi’s negotiating position should trade conditions shift in the future.

While the United States is the central focus of the strategy revamp, Audi is not neglecting its other global markets. In China, the company remains heavily invested, though it faces fierce competition from both international rivals and fast-growing local electric vehicle makers. Europe continues to be an important base, though it has matured into a slower-growth environment. The hope is that by achieving stronger profitability and higher sales volumes in the U.S., Audi can free up resources to pursue more aggressive campaigns in Asia and to accelerate electrification efforts across its global portfolio.

The scale of the ambition underscores the high stakes facing Audi at this juncture. The company has endured a challenging few years, marked by underperformance relative to peers and missed opportunities in the electric transition. Yet, under Doellner’s leadership, there is a renewed sense of urgency and clarity. The 2 million-car target is not tied to a specific year, but its very announcement highlights a determination to chart a new course. Achieving that figure would represent not only a financial milestone but also a symbolic reassertion of Audi’s place at the forefront of the global luxury car market.

Audi’s strategic reset thus combines bold ambition with practical recalibration. By anchoring its growth plans around U.S. expansion, accelerating product development, tightening operational discipline, and leveraging potential shifts in global trade policy, the brand hopes to turn a difficult recent history into a springboard for long-term success. The coming years will test whether this recalibrated vision can deliver, but for now, Audi is signaling that it is ready to reclaim lost ground and pursue a far more assertive trajectory in the global automotive arena.

(Adapted from MarketScreener.com)