Audi isn’t looking so hot. The company’s sales are flagging, showing a 16 percent drop in the third quarter of 2024 relative to the prior year, CarScoops reports, but the automaker hopes that its newest batch of cars will stop the slide. Having driven plenty of those new cars, there’s more to the problem than the car mix: Audi doesn’t give buyers a reason to get into the brand.
Audi is a luxury brand, but it’s not well differentiated within that market. Mercedes-Benz differentiates on comfort, BMW on sportiness, but Audi is trying to separate its brand out with “technology.” It’s a strategy that worked before, when Audi had a reputation for being the car of choice for tech bros, but the 2020s are a different time. Now, tech is cheap.
See, in the modern automotive world, “technology” usually doesn’t mean new hardware. You’ll get fancy lights, sure, or soft-close doors, but automakers have focused heavily on screens as the conduit for technology. You get apps, connected services, features based in software rather than hardware. Software that can be spread across multiple cars, updated and changed and charged for without changing a single bit of hardware. Software doesn’t cost much to add, relative to the cost of a car.
This means that Audi’s features don’t really come across as luxury, since cheaper automakers can match them spec for spec. The new Audi SUVs are replete with fancy interior lighting, with its own modes and themes, but so is my dad’s eight-year-old Camaro. The tech that Audi wants to differentiate on is table stakes even for cheaper segments of the industry — how is Audi supposed to make a whole luxury brand out of that?
This, more than the product mix, is why Audi is faltering. The cars are genuinely good, very good even, but in the minds of consumers there’s no killer app that’s worth shelling out for over the competition. It’s not an easy problem to solve, either, given that genuinely transformative technology like electrified forced induction or torque-vectoring differentials can be hard to explain to consumers — buyers like things they can see, hear, or feel the benefits of. Audi’s lack of differentiation, and the avenues it’s chosen to change that, have put the company in a tough spot. Hopefully the company can turn it around. With any luck, the new models will at least win out on style.
