Another luxury car brand closing dealerships across SA
Another luxury car brand is reportedly closing down some of its dealerships in South Africa.
Reports that the premium car brand Volvo will be closing 60% of its dealerships across South Africa recently made headlines across the nation.
Now, yet another automotive brand is said to be closing dealerships in the country.
According to the Motor Industry Staff Association (MISA), Audi is reportedly closing at least four dealerships.
In a recent press statement titled 'Audi South Africa Adapts to Market Challenges and Strengthens Customer-Centric Approach', the car brand announced that it is adapting to market struggles and changing consumer trends.
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It stated that high inflation, rising interest rates, and a weak exchange rate have put pressure on the premium car market in South Africa.
"These factors have intensified both affordability pressures on the consumer side, and pricing pressures on the manufacturer side," said Audi.
"This has prompted buyers to explore alternative options from new brand entrants, primarily targeting the price-sensitive volume segment with well-equipped vehicles."
According to TopAuto, the premium vehicle sector is now only a third of what it was just a decade ago.
"The entry of new brands has led to substantial and heightened competition in the retail space," said Audi.
Without naming any specific competing brands, Audi noted that customers are flocking to these alternatives "despite these brands often having a limited track record, potentially affecting residual values and the consumer experience."
"The need exists for a comprehensive automotive strategy, as well as decisive action and support from government, to ease the burden on all automotive players invested in the country," said Audi.
"While the automotive sector is a critical contributor to the South African economy, the industry continues to face hurdles such as slow and inconsistent policy implementation and insufficient infrastructure investment."
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Part of Audi's current struggle lies in South Africa’s slow uptake of BEVs (battery-electric vehicles), an industry in which Audi has heavily invested. This slow adoption is reportedly due in part to a lack of government support.
As a result of these challenges, the company has announced an "optimised footprint strategy."
"The initiative is collaboratively agreed upon, supported, and implemented together with the brand’s investors and retail partners," the company said.
"Scaled retail concepts and increased digital integration will support dealer partners in managing costs while maintaining high service standards for consumers."
The company added that it had "no further comment" on whether it would be closing additional dealerships in the country, but MISA reported that it is aware of at least four Audi branches shutting down.
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These include dealerships in Durban, eMalahleni, Johannesburg's East Rand, and Pietermaritzburg.
Audi confirmed that it remains committed to keeping its customers informed and engaged during the restructuring process.
"In cases where adjustments have been or will be made to specific areas within the retail network, customers will be advised proactively and provided with suitable alternatives," said the automaker.
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