After having colonized Cortina D’Ampezzo in February on the occasion of the Alpine Skiing World Championships, Audi has “invaded” Milan for the Design Week with a series of events, debates, discussions and installations which will however be scheduled until next 27 September and have their epicenter in the so-called “fashion triangle”. In this case, however, it is an appointment that has entered tradition, because this annual twinning between the German company and the Lombard capital is already in its seventh episode, with the only interruption in 2020 due to the pandemic.
“You cannot create the future alone – said Henrik Wenders, Senior Vice President Audi AG, at the inauguration – and anyone who has something to say can teach us something”. This explains the reasons for the perpetuation of such a demanding, expensive and not aimed at immediate commercial feedback.
At City Lab 2021 we chatted with Fabrizio Longo, Director of Audi Italia, not only related to the Milanese exhibition but also to the present and future of his brand.
What is the real reason for Audi’s presence in Milan?
«Thanks to the reduced dimensions of electric mechanics and the advent of autonomous driving, the style centers of the car manufacturers now enjoy a freedom of expression that they have never had in the previous fifty years. There is a reversal of perspective: yesterday we started from the external form that had to deal with the contents, today we start from the search for the new internal human dimension allowed by technologies and then we give it the external form. We are at Design Week not only to talk a little about ourselves but above all about what is happening next to us, which is what interests us most. We want to understand how cars can increasingly turn into a kind of extensions of the living room, into bubbles of wholesomeness. And to intercept new sensitivities, including social and ethical ones, because in addition to design, business models and technologies are involved. “
But isn’t autonomous driving still an idea too projected into the future?
«Many people today think that there are no environmental conditions for cars to move on their own, but think about just five years ago: would we have said that today we would have reached this point with the Adas and with certain applications related to mobility? There is a technological inertial speed that in five years can bring you to the market what now seems not exploitable.
The choice was: are we waiting for those who study, do their homework and then run after them or, as we are doing, do we anticipate the times, even though we are aware of the current limitations that limit the use of true autonomous driving to some areas of a few countries? And in fact the A8 is today the only production car prepared for level 3 autonomous driving. And we are moving towards levels 4 and 5 with the latest concepts we have presented ».
What changes will we see?
“You can also imagine what will happen in a passenger compartment where the driver can potentially turn into a passenger. He will return to appreciate the sacredness and centrality of his time, will have greater capacity for relaxation, will be able to decide to work, to communicate. The car is destined to give us what it has never given us in the last fifty years because we were so focused on its use that we couldn’t do anything else. Of course, those who want to drive will not have to give up an ounce of emotion and will have this option. As if to say that the healthy anarchist freedom to do what you want will increase ».
Are Italian customers ready for the electric car today? And what do they expect?
«Today we are already finalizing the experience with the electric. Including plug-in hybrids, we are close to 7/8% of the market while four years ago we were at 0.5. We are approaching percentages close to the double digits and that means a lot. In our experience, very different souls are approaching the electric one: people who are believing in a promise we are making to them in terms of driving pleasure, but also a less visceral clientele who appreciate smooth running and comfort. , which are much higher than those of normal cars. But as has already happened to Tesla, the first reason for this conversion is not the ecological soul, but the desire to feel like technological precursors. And then there is a part of customers who have already begun to appreciate its daily use, because when the autonomies begin to be really tangent to what is declared and approach 500 km, the anxiety about refueling is less.
The charging speed we have reached, in my opinion, is worth more than the autonomy, because the expectations of use become more natural if in half an hour you can regain 80% of the autonomy or if the 10 minutes you can gain 100 km. Then in July the agreement between VW Group and Enel was formalized for the development of the charging infrastructures: 3,000 high-speed stations – up to 150 kW – in seven hundred different locations. A new ecosystem is being created between two worlds that until recently looked at each other but did not talk to each other, because now there is the awareness that in order to have a transition quickly, one can no longer deal only with what has been done. until that moment. The result is that we have already registered 1,000 contracts for the Q4 e-tron in five weeks of marketing, apart from August. Even the dealers were amazed ».
How many of your Audi customers have already decided to give up thermal in favor of electric?
“I’d like to keep the answer in my pocket for a little while longer. In any case, the customers of the e-tron, our first electric car, certainly were in possession of another car too, but today’s Q4 e-tron is already beginning to be experienced as the first car and this is what the observatory of exchanges that we have at the source of the purchase of this model: we include Q5 and Q3 with thermal engines ».
Will the transition to electricity have major market repercussions?
«I don’t believe in traumatic revolutions but in intelligent transitions. Certain things are decided by the market: as an automotive player we can strongly influence demand but we cannot make things happen just because we have decided it ourselves. We have declared that from 2026 every new Audi model will be fully electrified and by 2033 there will be a gradual production exit of all thermal engines. This means that electrification is a definitive choice for us but that the announcement of the disappearance of internal combustion engines is not a terrorist message but we will take into account the needs of those regions of the world that are not yet ready for this transition. A different attitude would be arrogant and suicidal from a commercial point of view ».
A large part of your clientele is represented by people who face very high mileage and by companies. Will they be orphaned?
«Total electrification is Audi’s arrival point, but today we are accompanying the market towards the transition. We have an electric offer that is taking shape and substance even in numbers, 11 plug-in hybrid models, almost 100% of our cars are mild-hybrid and we also have methane-fueled proposals: that “calimero” that cyclically returns to topicality and , honestly, I don’t understand why, since it is one of the few resources Italy has. It is a missed opportunity. And in any case, keep in mind that as far as company cars are concerned, the electric is already making its way into the management bracket, because it becomes a corporate message towards the outside ».
How is the market responding to this offer?
“Better than I expected. We had the forecasts wrong at the end of 2020. In January 2021, I thought that the recovery of the premium segment depended only on the desire of customers to recover what they had denied themselves in the previous months due to the pandemic. On the other hand, the trend has not ended at all and the first half of this year was the best in Audi’s history worldwide and in Italy we stabilized on 4% of the market, our best share ever. Even if now we risk being slowed down a bit by the semiconductor crisis ».
Audi’s success in Italy is lasting. What is it due to?
“There is a brand equation that is working amazingly well. A House can have a momentary success for a lucky model but it is the medium / long-term attitudes that give continuity. We have been a leader in the premium market for 12 years because we have always focused on the perception of our brand without being intoxicated by the search for market numbers and without giving in to commercial pressures that we had. We have never changed our way of being by continuing to focus on technology, prestige and above all on a very concrete aspect as a residual value, which is the result of how you move on the market. People buy an Audi thinking they are making a major investment in terms of when they decide to resell it. In this, the sales network is of great importance: in the last 6 years we have reduced it by 50% but the dealers left today are a pool of entrepreneurs that we continue to train and who are our liaison officers between the parties ».
Will traditional dealerships be sidelined by e-commerce?
«We are very advanced in e-commerce but I am very convinced that there will be a coexistence between the physical and the digital world, because the experiential level ensured by traditional dealerships is unparalleled. I am very intrigued by what Amazon is doing, which has decided to open department stores. After the overdose of disintermediation via digital, someone has noticed that the physical dimension is supporting in complicated sectors like ours ».
Your cousins at Porsche are investing heavily in research on synthetic fuels to ensure a long life for the thermal engines by making them environmentally friendly, how do you live with them?
“It is the advantage of a large group, within which different attitudes can coexist while waiting for the definitive path to be identified”.