Audi deal­ers op­pose SAIC pro­duc­tion, sales plan

China Daily (Hong Kong) - - BUSINESS - By LI FUSHENG li­fusheng@chi­nadaily.com.cn

Audi AG’s deal­ers in China on Thurs­day ex­pressed a new wave of op­po­si­tion to the Ger­man car­maker’s in­ten­tion to pro­duce and sell cars with SAIC Mo­tor Corp Ltd, wor­ry­ing that a new dealer net­work would worsen their al­ready heavy losses.

The deal­ers claimed they lost 28 bil­lion yuan ($4.08 bil­lion) from 2014 to 2016 as Audi’s am­bi­tious es­ti­mates failed to ma­te­ri­al­ize.

That was ac­cord­ing to the new Audi deal­ers as­so­ci­a­tion, which was set up on Thurs­day in Sanya, Hainan prov­ince.

The as­so­ci­a­tion said Audi es­ti­mated in 2012 that its China sales would hit 1 mil­lion units in 2020, with a sales net­work of 580 deal­ers, a pro­jec­tion that mo­ti­vated deal­ers to ex­pand their in­vest­ments. Cur­rently there are around 530 au­tho­rized deal­ers.

“Each store costs 70 mil­lion yuan to 80 mil­lion yuan and the in­vest­ments have led to heavy losses,” it said in an open let­ter, which said un­der the cur­rent ar­range­ment they were due to suf­fer “great in­jury”.

“We would like to join with Audi to re­al­ize the goal of sell­ing 1 mil­lion cars by 2020 and af­ter the goal is re­al­ized, we will not ob­ject to its in­ten­tion of build­ing new part­ner­ships,” it added.

Audi did not com­ment on the deal­ers’ de­mands.

“We are look­ing for­ward to closely work­ing to­gether with the deal­ers as­so­ci­a­tion for the mu­tual ben­e­fit of the Audi brand and our net­work part­ners in China,” Audi said in an email to China Daily.

AFP

A woman takes a photo of an Audi TTS at an auto show in Shang­hai.

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