Audi SA looks set to reduce its dealer network

Audi looks set to join other premium car brands in shutting down some dealerships in SA due to the segment’s declining sales.

In a press release on Wednesday, Audi SA said it had started to implement an “optimised footprint strategy that balances meaningful customer experiences with operational efficiency”.

It said this was to reinforce its retail presence and ensure long-term partner viability in the wake of significant pressures faced by the premium automotive sector in recent years, marked by a buying-down trend driven by high inflation, rising interest rates and exchange rate weakness.

“Scaled retail concepts and increased digital integration will support dealer partners in managing costs while maintaining high service standards for consumers.”

The release didn’t say whether this meant Audi was reducing its dealer footprint but seemed to strongly suggest it. Audi SA said it had no further comment.

The press release further stated that Audi Centre Sandton would move to an unnamed new location in June and serve as Audi’s new flagship store.

The premium vehicle sector has contracted to nearly a third of its size compared with a decade ago, with 2024 marking the lowest level yet. Local consumers were increasingly moving to new brand entrants, many of them Chinese, primarily targeting the price-sensitive volume segment with well-equipped vehicles.

Audi said buyers were exploring alternative options despite these brands often having a limited track record which potentially affected residual values and consumer experience.

“Compounding these challenges is the absence of a regulatory framework and incentive support schemes by the SA government — such as those available for battery electric vehicles (BEVs) in other industrialised nations — further accelerating market trajectories,” Audi said.

“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. While the automotive sector is a critical contributor to the SA economy, the industry continues to face hurdles such as slow and inconsistent policy implementation and insufficient infrastructure investment.”

Other premium brands have reduced their dealer footprints, with Businesstech reporting that BMW shrunk from 55 sites in 2015 to 46 at the end of 2024. Swedish brand Volvo recently announced it is reducing its SA dealer network from 19 to seven facilities.

Audi said all customers affected by the current changes have been contacted and informed of their alternatives and all warranty, service and maintenance policies remain fully intact.

The Audi Customer Interaction Centre can be contacted on 0860-434-838 and a list of Audi SA dealers and their contact details are available on www.audi.co.za.

Audi has sold 1,266 new cars in SA so far this year, with the A1 hatchback and Q3 SUV its two most popular models.