Once a fierce rival to Mercedes-Benz and BMW, Audi India’s presence in the luxury car market has shrunk dramatically over the past decade.
Despite its global prestige, the brand’s Indian journey tells a story of lost momentum, missed opportunities, and a brand identity crisis that has proven difficult to shake off.
Audi India: From market leader to laggard
In 2013, Audi was India’s top luxury carmaker, selling over 10,000 units and outpacing German rivals. However, its fortunes have reversed sharply since then. The company sold 5,816 cars in 2024 and just 2,128 units in the first half of 2025 – a steep 63% year-on-year fall. Cumulative sales have only recently crossed the 1,00,000 mark, while its ranking in the luxury car market has slipped to third, with even Jaguar Land Rover threatening to overtake it.
Industry data shows a further 18% year-on-year drop in the first nine months of 2025, with sales falling to 3,197 units from 3,889 during the same period last year. Analysts estimate that FY25 volumes fell 15% to 5,993 units from 7,027 in FY24, underscoring the brand’s sustained struggle in a market that continues to expand.
However, Balbir Singh Dhillon, Head of Audi India, maintained, “Our focus is on sustainable, quality-led growth rather than short-term market share fluctuations. Over the past few years, we have strengthened our product portfolio with popular Q range SUVs, performance models and the fully electric e-tron range addressing a wider customer base than ever before.”
Audi’s India Story: Diesel exit and product delay
Audi’s decline accelerated after the 2020 transition to BS-VI emission norms, which forced the brand to discontinue diesel engines that once contributed nearly 70% of its volumes. Unlike Mercedes-Benz and BMW, Audi lacked ready petrol replacements, causing a major sales slump and dealer disillusionment, according to dealer sources
“Both ICE and EV portfolios are integral to our strategy in India,” averred Dhillon, adding, “In the near term, our ICE models will continue to drive volumes, while our EV range represents a long-term investment aligned with Audi’s global commitment to sustainable mobility.”
Audi India: Shrinking footprint and missing models
Audi’s dealership network has shrunk from nearly 40 outlets in 2018 to around 25 today, eroding its visibility in smaller cities. Moreover, the company’s limited local assembly – under 20,000 units a year at its Aurangabad facility (under parent Skoda Auto VW India Limited)- and high import content make its cars more expensive than rivals with deeper localisation, according to industry analysts.
The brand also vacated the entry-level luxury space by discontinuing models like the A3 and Q2, leaving a vacuum in the Rs 40-50 lakh bracket – a sweet spot now dominated by BMW’s 2 Series and Mercedes’ GLA. “India remains a strategic market for Audi, and future investment decisions will be guided by our long-term product roadmap and the growing potential of the luxury EV segment,” as per Dhillon.
Audi India: Calculations gone wrong? SUV and EV missteps
India’s luxury market has tilted decisively toward SUVs, now accounting for over 70% of segment sales. But Audi’s SUV lineup – Q3, Q5, and Q7 – faced long product gaps, allowing rivals to cement their dominance. While Audi was among the first to introduce electric models with the e-tron range, the fully imported price tag of over Rs 1 crore kept sales marginal.
Image erosion and brand disconnect
Brand experts argue that Audi’s challenges run deeper than product cycles. Avik Chattopadhyay, Founder of Expereal, said, “Audi today suffers from a major image issue in India. About 15 years ago, it chased volume at the cost of exclusivity, catering to segments that eroded its aspirational appeal. It is now perceived as a car for real estate agents and traders rather than for luxury enthusiasts.”
He added, “The brand hasn’t communicated its rich legacy or leveraged the ‘Quattro’ proposition to connect with motoring enthusiasts. It’s seen as just another luxury badge, rather than the sporty, performance-oriented marque it truly is. Thirdly, the brand has failed to capitalise on the “motoring” enthusiast segment using the Quattro proposition. It is simply slotted as yet another “luxury” badge alongside Mercedes-Benz, BMW and Jaguar. It should have positioned itself for the premium motoring enthusiasts, just like TAG Heuer is the sporty luxury watch brand vis-a-vis an Omega or a Rolex.”
A slow road to recovery
Mohit Yadav, Director at AltInfo, observed that “BMW and Mercedes have gained traction through aggressive EV strategies and localised manufacturing, while Audi’s slower product cycle and limited electric push have eroded its market share.” Even though Audi’s pre-owned car business grew 31%, he said, it wasn’t enough to offset core weakness.
Despite the slump, Dhillon remains optimistic: “Our focus is on sustainable, quality-led growth rather than short-term market share fluctuations. We’ve strengthened our product portfolio with popular Q-range SUVs, performance models, and the fully electric e-tron range to address a wider customer base.”
With new generations of the A6 and Q3 expected in 2025, Audi India is preparing for a fresh chapter. But analysts caution that unless it deepens localisation, revives entry-level offerings, and rebuilds dealer confidence, the four rings may continue to glimmer faintly in India’s fast-evolving luxury car landscape.