Volkswagen contends sister brand Audi with new China-only model

by SpeedLux
People gather around the Volkswagen's Phideon as it is presented during the Auto China 2016 auto show in Beijing April 25, 2016. REUTERS/Damir Sagolj/File Photo

Volkswagen will introduce a high-end sedan in China on Friday that will take on directly with sibling brand name Audi and is aimed at purchasers searching for elegant yet less-flashy vehicles amidst a countrywide crackdown on conspicuous consumption.

Chinese President Xi Jinping’s sweeping war on ingrained graft and lavish way of lives since presuming power nearly four years ago has made the country’s consumer more careful about showing wealth when buying anything – from expensive cars to designer bags.

Volkswagen hopes the Phideon, a high-end style sedan from a brand that has a mass-market image, will assist it cash in on purchasers’ beliefs and drive sales in China – the world’s leading automobile market.

” Shiny, blingy showing-off is no longer the habits in the (bigger) cities,” stated Holger Santel, vice president of sales for SAIC Volkswagen, company’s joint venture with SAIC Motor. Consumers are significantly saying “I do not want Audi, Benz, BMW. I don’t want to show off.”

Volkswagen showed the Phideon together with Audi’s A6 sedan, BMW’s (BMWG.DE) 5 series and Daimlers’ (DAIGn.DE) Mercedes-Benz E-Class at a media event in Shanghai, suggesting it expects the Phideon to take on with these German luxury marques.

“We definitely believe that our models are positioned in their own market sections,” an Audi spokesman stated, including Audi does not comment on Volkswagen models as a matter of policy.

Audi initially rose to prominence in China as the automobile of option for government officials and some of its association with government excesses persists to this day.

The Audi A6 has a flashier price than Phideon however could cost the same after car dealership discount rates, auto specialists say.

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