Audi set to target Melbourne

A ‘HUGE’ new Audi dealership will be built in Melbourne to replace the current city site as Audi targets major growth in the southern state.

The airport terminal-style development – known as a ‘lighthouse’ in Audi jargon – is expected to rival similar big showroom and service centres in Sydney and Brisbane as the German brand gears up to double its model range to 62 models by 2020.

Audi is headed towards its seventh consecutive year of record sales in Australia, up more than 10 per cent in the first half of 2011 and on target to blitz its 2015 goal of 15,000 units four years early.

To be built for prestige car dealer Zagame Automotive Group, the new Audi Centre Melbourne will replace the current seven-year-old downtown dealership in Swanston St which Audi Australia managing director Uwe Hagen says is already too small to cope with the brand’s planned expansion.

Zagame acquired Audi Centre Melbourne and its satellite operation in Richmond just eight months ago.

The company, headed by Bobby Zagame, also recently bought Brighton Audi in the prime affluent area south of the city, taking over from August 1.

Left: Inside the Audi Lighthouse in Sydney, the launch of the new Audi Centre Gold Coast, Audi's current downtown Melbourne dealership, Audi Centre Parramatta.

Not to be outdone, rival Melbourne dealer group Penfold is building a new Audi dealership at Doncaster, in the north-eastern suburbs, to complement it current modern dealership in Burwood, in the city’s east.

Mr Hagen told GoAuto that Audi Australia had identified great potential for growth in Victoria, and needed to invest in showroom and service facilities to take advantage of it.

He declined to discuss potential sites or opening dates for the new Melbourne ‘lighthouse’, which will be just the latest development in one of Australia’s most ambitious dealer network expansions that started in 2009 with the massive $50 million Audi showroom and national headquarters between the Sydney CBD and the airport, in South Dowling St.

Others have followed in Parramatta, Pennant Hills, Adelaide, Gold Coast, Brisbane, Cairns, Bendigo, Orange, Ballarat, Berwick, Brighton, Launceston and Newcastle.

As well as Melbourne, another big lighthouse development is planned for Perth, where the facility is expected to have a whopping 75-metre street frontage.

Rural ‘regional terminal’ centres are also under construction at Shepparton and Wagga Wagga as part of the national rebirth of the brand, in which the dealer group has collectively invested about $210 million.

The Zagame Group, which opened the biggest Ferrari-Maserati dealership in the southern hemisphere in a $30 million investment in the inner Melbourne suburb of Richmond in 2008, also counts Fiat, Citroen, Alfa Romeo, Skoda, Lotus, MG and Morgan franchises in its line-up.

The luxurious 10,000-square-metre Ferrari-Maserati dealership was three years in the planning and has space to display 30 cars on two floors.

All of the current Zagame facilities are within a tight circle of the Melbourne CBD, and logic suggests any new Audi facility will have to be in the same prime area.

Mr Hagen described the planned dealership as “a huge facility” similar to the developments opened in Sydney and Brisbane.

He said the new $11 million Audi Centre Brisbane dealership in Fortitude Valley had an internal display area capable of holding 25 vehicles and a service area with 20 bays.

The new Brisbane dealership replaces a facility just 10 years old, underlining the frantic pace of Audi growth that continued through the global financial crisis when other companies faltered.

This year, Audi’s sales are up 10.4 per cent on the back of the all-new A1 light car and an uptick in sales of Audi’s SUVs, the Q5 and Q7. The arrival of the new A6 range is expected to give the sales a second-half lift.

Fellow German prestige car brands BMW and Mercedes-Benz have both suffered a decline in sales this year, with BMW down 3.7 per cent and Mercedes sliding 10 per cent.

Mr Hagen said Audi’s facilities needed to match the planned growth of Audi, not only in sales but in service.

“When you have growth like this, you need facilities,” he said. “Our new dealerships have doubled the number of hoists.”

Mr Hagen said early planning was needed to ensure customer satisfaction, and that included staff recruitment and training.

“We have not just built new facilities, we have doubled the number of employees,” he said.

Mr Hagen said Audi was conscious of the pressure on the dealer group of new-model launches, particularly on service technicians who had to keep up with many new technologies.

He said this was taken into consideration when planning new-model introductions.

Currently, Audi has about 30 models under the A1, A3, A4, A5, A6, A7, A8, Q5, Q7, R8 and TT badges.

These will be joined by the Q3 compact SUV in the first half of 2012 – a move that almost certainly will guarantee an eighth record year of Audi sales, provided the Australian subsidiary can get sufficient stock.

From 2013, the first hybrid Audi vehicles are expected to arrive, in the A6 and A8.