The news
Volkswagen is replacing the CEO of its luxury brand Audi and is naming Gernot Döllner to succeed Markus Duesmann as the company looks to accelerate its transition to electric vehicles.
Mr. Döllner, who previously served as Volkswagen’s chief strategist, will take up his new role on September 1, Audi said in a statement on Thursday. Though Audi is profitable, it’s struggling to transition to battery power and compete with the growing threat from Chinese automakers.
Herbert Diess, CEO of Volkswagen before Oliver Blume took over in September, brought Mr Duesmann to Audi from BMW three years ago in hopes he could help the brand drive innovation and boost sales of its electric models.
The company’s profit increased by 40 percent in 2022 to 7.6 billion euros or 8.3 billion US dollars. This is due to the decision to prioritize higher-end vehicles over cheaper cars as the company overcame a chip shortage due to the supply chain disruptions related to the coronavirus pandemic.
Audi is currently working on the last generation of models with internal combustion engines and plans to add ten new electric models to its range before aiming to produce only electric vehicles from 2026.
What it means: Audi is in competition for electric vehicles.
Audi is Volkswagen’s second most important luxury line after Porsche. Although Porsche has successfully entered the electric vehicle market, Audi’s strength lies in the continued popularity of its internal combustion engine vehicles.
Now the company faces stiff competition from leading electric vehicle makers like Tesla and Chinese automakers. Mr. Blume said he expects the company to maintain 14 percent growth and that he wishes Audi would better coordinate its production with VW and Porsche.
With Mr. Döllner at the helm of the company, this becomes easier as he worked with Mr. Blume for many years when both were top managers at Porsche, which like Audi is part of the Volkswagen Group.
Mr. Döllner has been with Volkswagen since 1993, while he was still doing his doctorate. He was head of the four-door Panamera sedan series from Porsche, which he helped develop.
What’s next: A focus on North America and China.
A key focus of Mr. Döllner will be to advance talks about opening a factory in North America. Audi’s main competitors, BMW and Mercedes-Benz, both have manufacturing facilities in the US, allowing them to produce almost twice as many vehicles for that market. Audi’s SUVs are proving popular with US drivers, and the company is considering developing electric versions of several of its flagship models.
In China, Audi’s internal combustion engine vehicles remain popular, but the company needs to ramp up electric vehicle production if it wants to remain competitive with popular local manufacturers like BYD and Chery.