About one in every three Audis sold new last year was purchased in China. That’s almost three times as many cars as were sold in North America, or about as many cars sold in all of Europe. China is important.
The company’s plan last year was to try to start a bit of a reset, with a new sub-brand. The name of this new Audi offering? AUDI. It’s just Audi, uppercase, and without the rings. It turns out that silly marketing can’t fix serious problems. Oops.
While we’re on the topic of Spider-Man pointing to Spider-Man, Toyota’s Toyoda looks like it’ll finally be able to buy Toyota Industries, which is a company that’s not totally owned by Toyota.
In less recursive news, there’s another war on, and the impacts could be small, or they could be huge. No one knows anything. That’s not entirely true. UAW workers at Stellantis know exactly who to blame for the loss of bonuses for 2025.
Adventurous Adopters Aren’t Appreciating Audi’s Audacious AUDIs
If it seems like I’m constantly harping on Audi, it’s because the brand is important and there’s no reason why it has to be a failure. If you’re a member of the four-ringed faithful, perhaps 2025 represents the bottom.
Sales were down 3% globally to 1.6 million vehicles, led by a 5% drop in China to about 618,000 vehicles. One of Audi’s big plans to compete with the rapid adoption of well-liked, tech-forward domestic options was a new brand: AUDI. That’s Audi, but with no rings and the caps lock key engaged. The first AUDI is the E5 Sportback.
This is a locally-built car developed in conjunction with long-time Volkswagen partner SAIC. It’s an attractive five-door wagon with specs that are, if not better than what the best China has to offer, at least closer.
It only went on sale last year, but thus far, it hasn’t exactly set the world on fire. As Bloomberg reports, sales numbered just 605 in January. That compares to about 8,000 Model 3s and more than 20,000 Xiaomi SU7s.
Bigger than that, the vehicle is predictably plagued with issues, according to one owner who spoke to Bloomberg:
“I prefer cars that are a bit more niche and I really love the styling,” said Neo Shen, a Shanghai-based engineer who bought the most premium version of E5 Sportback. The car retails for between 235,900 yuan ($34,000) and 319,900 yuan.
But “the infotainment system is a total work-in-progress and full of bugs,” he said. The air conditioning turns on by default every time he starts the engine and the driver-assistance features are too slow for city driving, making him miss off-ramps on highways.
(Note: the “engine” thing is a mistake; Bloomberg is going to fix it.)
The E5 Sportback did win the China Car of the Year award, and it’s still early days. A lot of the bugs can be worked out eventually, although other issues, like slightly slower charging speed, probably cannot.
Either way, it seems like AUDI isn’t the silver bullet Audi needs.
Toyoda Triumphs, Toyota Takes Toyota
I haven’t been reporting much on the back and forth of it all, but the original company that Akio Toyoda’s grandfather founded, which eventually became Toyota the carmaker, is a textile company called Toyota Industries, and Toyota Group really wants it. Why? It’s a textile company that also makes hybrid components and forklifts.
There was only one obstacle: Elliott Investment Management. The American-owned activist investor owns the largest independent chunk of the company, and it’s long accused Toyota Group of trying to muscle the company out for too low a price, given how profitable Toyota Industries is.
Stubbornness works! Toyota is going to pay $132 per share, which is way more than the original $104 offer. As Automotive News points out, this is part of a larger trend of minority shareholders trying to exert more influence on Japanese companies:
The privatization also addresses a complicated parent-subsidiary relationship between Toyota Motor and Toyota Industries as investors and regulators increasingly frown on cross-holdings.
The cross-holdings bind allied Japanese companies through business and capital tie-ups in a structure known in Japan as the keiretsu system. Critics say it introduces corporate governance issues such as conflicts of interests and opaque financial relationships, while also locking up capital that could be better invested elsewhere. The system also tends to ignore minority investor input.
It’s a big win for Toyota and Toyoda as the company is probably worth more than what they paid for it.
Carlos’s Choices Confound Chrysler-ites
The combination of tariffs and poor leadership has resulted in UAW workers at Stellantis being deprived of bonus checks, after getting up to $14,000 just two years ago. While the tariffs are a big part of it, the bad choices ex-CEO Carlo Tavares made seem to be getting most of the attention from workers who spoke with The Detroit News:
Reactions on Thursday varied by plant. At Sterling Heights Assembly, where workers have been recently working long hours to churn out Ram 1500 pickups, a letter to members from Local 1700 President Michael Spencer indicated workers were fed up. He told them they “will not be walking out on a wild cat strike,” and urged them to keep building “the best quality vehicles possible.”
“I do want to express the disappointment of the thousands of UAW Members who come to work every day and deserve better from Stellantis Corporate leadership in their decisions, product planning and fiduciary responsibility,” Spencer added. “Corporate greed drove the decision to offshore production, cut jobs and speed up production lines.”
If there’s any silver lining here, it’s that workers seem to think the new guy is a lot better than the old guy, and there appears to be an appetite to give him a chance.
Alliteration Is A Little Too Glib For This One
Oh, right, I started the alliteration thing and then realized I didn’t want to do it for this story. There’s a war going on, or police action, or whatever it’s being called. It’s nominally between Iran and the United States/Israel, but it’s inflamed the entire Middle East.
In light of the real threats and human suffering, the possible impact on the automotive world seems less important. That all being said, the automotive world has endured one supply chain shock after another since 2020, and any time it seems like things are cooling off, something else happens. This counts as something else.
The big questions are: How long will this last, and will the strategic Strait of Hormuz stay closed? Without answers, whatever happens next is just speculation. Still, as Automotive News reports, the industry is keeping a close eye on it.
It might be nothing, but here’s the logical worst case:
David Whiston, an equity analyst at Morningstar Research Services, told Automotive News that the struggle to ship oil and other automotive components out of the region could add to the industry’s growing affordability crisis.
“That just adds more inflation to making a vehicle, which is already battling tariff costs,” he said.
Long-term, Whiston worries about a broader impact to the economy and potential recession.
“If the war is prolonged, then it’s a question of does it cause U.S. business to freeze spending which will in turn lead to a slowdown, if not recession and layoffs,” he said.
Fun times.
What I’m Listening To While Writing TMD
You’re the first to learn that, if you become a member in March (or upgrade an existing subscription), you’ll not only get 10% off your order, you’ll also be entered into a drawing to be added to a group chat with your favorite Autopian authors in April. The bit I wanted to do for this is use a screenshot from “The Telephone Hour” from Bye Bye Birdie, but everyone told me that was weird. Either way, follow this link or use the code groupchat at checkout.
The Big Question
What’s the best automotive sub-brand, and why is it Merkur?
Top photo: AUDI
They’ll totally get the bonus after the federal government sends them a fat rebate over the illegal tariffs.
The other problem, however, is there’s probably a heavy percentage of workers that have banked on getting a $14k bonus every year and have already spent it in advance. There’s some basic financial literacy lessons that are sorely missing from public schools.
I’m convinced those two leopards totally won’t eat their face.
So, they’re just SHOUTING now?
I am perplexed, so perhaps someone who has lived (or is living) in China can explain this.
Is AUDI pronounced differently from Audi?
Does it use very different Chinese characters?
Because if the answer to either of those questions is ‘no’, and the problem is Chinese buyers’ perception of the Audi brand, then you haven’t really fixed anything, right?
What I’m listening to.
Back in High School, I was in Bye Bye Birdie. I played lots of bit parts, including Harvey Johnson.
Shockingly, as soon as the song started, I knew the words and could have sung along. It’s been about 40 years and my brain still has that in long erm storage, while I can’t remember what I ate for breakfast.
Likewise, except I played Conrad Birdie himself 🙂
It’s been interesting to read that Audi is having such a poor time. In the past couple of years, I’ve noticed so many Audis on Colorado roads. Much more than comparable luxury brands. But then again, it seems to be the tuner of choice, as they’re often lowered, zipping through traffic by a 20-something. Secondary market sales probably aren’t helping the company if primary buyers don’t stay with the brand.
Hmmm… Audi is the new Infiniti?
What’s the best automotive sub-brand, and why is it Merkur?
The XR4Ti rides like a dream but handles great!
I’m glad to see VW worker guy again. I hope he and his loved ones are doing well.
Another Awesome Article, Att Ardigree!
Autozam was a great sub brand.
I liked Scion too. Different designs
Scion iQ my beloved!
Two different 1st gen xB’s here. I met life-long friends through Scion and the events they used to sponsor.
To paraphrase Beyoncé: AUDI, if you liked it then you shoulda put some rings on it.
As to Stellantis: Meet the new boss, same as the old boss. Hope we don’t get fooled again.
Rock on.
It’s Cadillac V by a mile.
Younger people who have grown up with Cadillac as a performance brand have no idea how hard that title had to be won, and how ridiculous the very idea seemed at the start.
Blackwings being generally acknowledged as the best driving sedans in the world 20 years after Cadillac’s sportiest offering was legitimately the FWD Seville is quite the transformation.
After the loss of the dream of a 6MT CTS-V Wagon, the pinnacle of the fun, they’re dead to me as an aspirational brand.
I’ll have to settle with a dream of an Audi, instead.
I think we need a definition of “sub-brand”. Cadillac was started in 1902 as an independent company, predating all GM brands except Olds and Buick. I think of a sub-brand as a marque originated by an existing marque, e.g., Saturn, Lexus, Acura, Scion, Infiniti, Imperial, Edsel, Geo, as well as Matt’s favorite Merkur, in order to address a particular market.
But yeah, the Blackwings are special.
Best automotive sub-brand? Early Scion.
If Audi doesnt have rings anymore, what am I going to hit with my Sonic?
I dunno, but I’m gonna have to see if your Sonic drops any rings. Not gonna crash into it, just hit it with my knuckles.
Well done. Very well done.
Is it just me or does the AUDI thing feel like they’re blatantly inviting parody in GTA6 with OUTIE on the name plates of the obviousy-Audi-but-trademark-compliant cars?
If not AUDI, maybe INNI, or is that too close for comfort and BMW would complain?
I’d think the normal GTA driving style while in a BMW knockoff might be enough to trigger some kind of trademark infiringement…
Ugh, enough replacing emblems with letters. Now you can’t even look at a CUV blob and tell what brand it is at a glance because the 5 letters could be TESLA or MAZDA or ACURA, etc.
I’m sure you can find tutors in your area who will help you read well enough to differentiate them 😉
All kidding aside, I also strongly prefer emblems over name badging.
My big gripe about it is when you pull up behind a vehicle with the spelled-out make is the jarring difference in lettering style (font, all caps/lowercase, itallics, etc.) between the make, model and trim badges. It kind of feels like a OEM-applied bumper sticker collage or someone went HAM with the PepBoys fake badges.
What, you don’t like to see:
Subaru
O U T B A C K
Touring XT AWD
(right eye twitching while physically cringing)
No, what gave it away?
Just wait till the AI gets ahold of it. /-\|_UR/–
Fun new game though:AI interpretation of a car or fly-by-night Amazon brand?
Or Elon’s child
I irrationally despise the M A Z D A lettering on the back of the new CX-5.
It’s especially disappointing from Mazda, as it feels like such a me too marketing choice from a company that used to feel like it stuck to it’s principles.
Totally agreed.
Oh come on now. I wouldn’t call it irrational
Especially since chrome letters with odd angles of lighting just makes it harder.
Especially since not everyone speaks English or uses the same alphabet. That was the whole point of logos!