One of the worst-hit industries in the pandemic is the luxury auto sector. And even though the sector is opening up its operations in a select few places in the country, a tumultuous road lies ahead. Balbir Singh Dhillon, Head of Audi India, however, says that the brand has a clear roadmap. In an e-mail interview, Dhillon talks about the company’s business strategies, growth plans and digitalisation.
What are Audi India’s plans once the lockdown ends?
We are happy to announce the re-opening of our dealerships, wherever the local authorities are allowing us to do so. Two-third of our workshops and over half of our showrooms are operational and due care given to sanitisation and social distancing.
We have a clear roadmap in place and we have termed it Strategy 2025. This strategy includes four key pillars for the brand: customer centricity, digitalisation, products and network. And each of these pillars is of equal importance. On the product front, our launch plans for 2020 include a mix of volume and performance models. These launch timelines will be announced shortly
What is your business strategy going forward? How has it changed since March 2020?
We continue to invest heavily in digitalisation and are confident that our tech-savvy buyers will appreciate what we have to offer. Our segment-first initiatives include augmented reality, which allows a complete view of the car inside and out; from your living room. On the network front; we will continue to expand as per demand and our focus on our workshop-first strategy remains intact.
COVID-19 has changed a few elements in the immediate future plan. Certain projects/initiatives that we were earlier looking to implement in Q3 will now be implemented in Q2; the most important being ramping up of our digitalisation initiatives. Meanwhile, product launches in Q2 will move to Q3. These short-term strategy movements are regular adjustments that we will have to make. Having said that, our medium and long-term strategies remain the same as we believe in the India story.
How do you plan to attract consumers’ attention post the lockdown?
As things gradually return to normal, we are analysing buying patterns to understand how we can encourage sales and offer financial solutions to our customers. Financial solutions offered by our dealers include a host of flexible payment schemes in line with what our customers need. Recent announcements by the RBI to reduce interest rates will act as a booster for our customers and we see it as an attractive proposition. Apart from financial products, Audi India also offers best-in-class ‘car life’ products like a service package of up to eight years, extended warranty up to seven years (segment-first) and road-side assistance (segment-first) up to 11 years. All these products have been designed for the peace of mind of our customers.
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Going forward, we also see a growing demand for pre-owned luxury cars. Our Audi-approved: Plus vertical has been continually growing over the past few years, and we see it playing a pivotal role going forward. Flexible financial products and ‘car life’ products are also available for our pre-owned car customers.
Have you had any sales/bookings during the lockdown?
Safety has been a key priority for Audi India. Dealerships were closed for a period of over 45 days and we have only recently opened our workshops, spare part units and dealerships as per directives from the central and state governments.
April was a month of zero sales for the entire automotive industry. Half of May has been a washout as well. In times like these, human life takes precedence over business. With things now slowly returning to normalcy, we will focus on building the brand in a sustainable and profitable manner. Our continued focus on digitalisation in the current times has held us in good stead.
Will you be able to retain all your staff and start manufacturing immediately after the lockdown?
Our group has already announced that there will be no loss of jobs. Our production unit in Aurangabad has begun operation with minimum staff as per directives from the government.
What will be Audi’s sanitization process?
Our utmost priority is people’s safety. We are following strict protocols and implementing best practices to ensure a completely sanitised environment at our showrooms, workshops and offices. Safety measures at Audi India touchpoints include complete sanitisation of workshops and showrooms twice a day including all access points, fixtures and furniture. The cars are being sanitised across touchpoints with Audi care products and processed through contactless documentation. Employees at workshops, dealerships and other units are following a staggered entry and exit system and the use of masks, gloves and sanitisers is compulsory. A mandatory thermal check is being done at the entrance and social distancing of six feet is maintained at all times in all areas.
Will online sales precede offline sales?
While our belief in a digital future is profound, the advent of COVID-19 has only made it stronger as to how we interact with our customers going forward. Earlier this month, we announced a vital step in our digitalisation journey with the roll-out of digital sales and after-sales offerings. The incorporation of augmented reality, a 360° product visualizer and online bookings on the Audi India website bring the buying experience straight to a prospective customer’s fingertips. We have seen a great number of visitors on our website post its introduction and we are confident that our segment-first initiatives will continue to attract tech-savvy buyers.
At the same time, it is important to note that the luxury car space operates in a slightly more complex manner, given the price factor. Dealerships will continue to be of extreme importance as Indians are accustomed to buying products after seeing it at a dealership and driving it to review its performance. For Audi India, digitalisation will continue to be at the core of our strategy; we want our customers to know what we truly stand for—Vorsprung durch Technik (which means progress through technology).
How do you ensure that your employees are motivated in tough times such as these?
I have always believed that a business is as good as the people associated with it. It is important to train your teams for such situations and keep them motivated to deal with uncharted waters. We are a close-knit team. We connect once a week/fortnight—as many as 60 employees connect on one skype call. We see each other, discuss our week and our work-from-home routines. We also have quizzes and contests to keep employees motivated. These activities go a long way in keeping everyone’s morale high. Through various digital mediums, I connect with colleagues, dealer partners and the HQ to ensure things are in place and we have our business in order.
How do you think the world will change post the lockdown?
On an individual level, the pandemic is likely to cause two types of social behaviours. For a large section of the population, COVID-19 provides an ideal opportunity to re-evaluate current lifestyle choices, make adjustments and reset lives. This set of people will look at a more frugal approach to life.
For the other set of people, there will be the need to self-gratify (YOLO – You live only once attitude). For over 50 days, people have deferred their needs; there is a fear of uncertainty and hence consumers may want to splurge on desirables. This is also known as conspicuous consumption, where consumers spend on or consume different levels of luxuries in an attempt to enhance their stature.
Additionally, people will start travelling domestically. They will prefer to drive rather than hop on a long, international flight as global travel will bring its own set of challenges. This may motivate our target set of consumers to buy their preferred luxury car.
While this does give us hope; we don’t see growth in the luxury car market in India until 2021. The next few months will remain challenging and there will only be some sort of push around the festive season.
What is your lockdown routine?
My day starts at 8.45 am with a team Skype call—not only to discuss work but also to check up on all my Heads of Departments and their individual teams. This is followed by calls and online meetings with the HQ and completing tasks on my to-do list, which varies every day. I take time out for a coffee break and lunch with my family. My work-day usually ends at around 9 pm.
How do you unwind after a long day?
I like to unwind with a glass of red wine and a book.
Which book are you reading these days?
I was recently reading ‘Good to Great: Why Some Companies Make the Leap…And Others Don’t’ by Jim Collins, I like the book because it describes how companies transition from being good to great and the author’s perspective makes really great sense.