Audi's Approach: Go Head-to-Head With The "Local" Rivals.
Johan de Nysschen, executive vice president in charge of Audi of America, shows a market matrix that goes from Mainstream and Traditional at the intersection of the axes and Premium at the end of the Y axis and Progressive at the end of X. Moreover, there is a separation of two categories of manufacturers, Tier 1 and Tier 2, with the former including Jaguar, Mercedes, Lexus, BMW and Audi; Tier 2 includes Saab, Acura, Volvo, and Infiniti. De Nysschen says Audi's goal is to move to the most Premium and Progressive position among all of the vehicle manufacturers. Perhaps because it, too, is a German company, it is focusing primarily on Mercedes and BMW, with the A4 going up against the C-Class and 3 Series; the A6 against the E-Class and 5 Series; the A8 against the S-Class and the 7 Series. But the A3. . . ? Once again, there are competitors from the companies in question, the Mercedes B-Class, which isn't planned for the U.S., and the BMW 1 Series, which may be redesigned as a coupe and become the 2 Series. In effect, then, with the A3 Audi has the field more open and the ability to define what a Premium and Progressive four-door hatch is all about. Or at least what it is for the American market.
Appealing in America.
The first-generation A3 appeared in Europe in 1996. It never came to the U.S. When the planning commenced five years ago for the new A3, a decision was made, says Mark Trahan, director of Aftersales, that there would be a specific design for the U.S. and Canadian markets. Yes, there would be a three-door hatch for the European markets. And there would be a five-door model, as well. But the five-door would be specifically tailored for those who haven't found the hatch to be a model to aspire to—or who wouldn't even take a second look at a hatch if they were shopping for an econobox. The point is, the hatch architecture hasn't been happening in the U.S. market. So exterior designer Gary Telaak set about to create a car that would be appealing in America. The three-door is an entirely different car than the five-door. "The two cars have their own character." Each has its own design. Still, there is an acknowledgement of the comparatively small demand for hatches in the U.S., as it is expected that of the 150,000 or so A3s coming out of the Ingolstadt, Germany, plant, only about 10,000 will come to the U.S. (and Canada).
What's the Price of Premium?
One of the evident concerns that exists is to provide a vehicle that, in Trahan's description, is a "four-door car with the sportiness of a TT coupe" at a "more attainable price"—yet while retaining the luxury status of the Audi brand. The base A3, including a six-speed manual transmission, has an MSRP of $24,740, which is roughly $5,000 to $10,000 or so less than what could be considered "luxury." The version with an automatic transmission—the clever Direct Shift Gear Box (more on it below)—brings the base price to $26,140. But when you begin to add the optional packages ("sport" for $1,800; "premium" for $2,025), and various options, from metallic/pearl effect paint ($450) to navigation and sound ($2,850), it doesn't take long for the vehicle to bump up against the lower range of what can be considered luxury. (The German competitors have product around $30K, while the likes of Lexus and Infiniti are more in the $35K range.) Still, even with the entry package, with the high-quality materials on the interior (very much like those in the TT), the fundamental solidity of the vehicle (the body is 60% high-strength or ultra-high-strength steel and is lighter but 35% more rigid than the previous A3), and a chassis that includes MacPherson struts in the front, an independent four-link setup in the rear, and electromechanical steering all contribute to the A3 being much more than a run-of-the-mill vehicle.
When Is A Platform Not A Platform?
"We've moved away from the notion of platforms. We use modules in our group now," says de Nysschen. Platforms, the thinking goes, share the same floor pan and hard points. So the new word at Audi is "modules." There is a set of components—such as for an A-class vehicle—that can be "bundled" together to create specific products. (So a Golf is not an A3, platform-wise.)
Powered by Technology.
One of the apparent strategies that Audi is using in bringing the A3 to market is reflected in its tagline: "Vorsprung durch technik," or "progress through technology." This is particularly apparent in the powertrain, which is a standout feature of the vehicle. Axel Eiser, who led the development of the engine for the A3, says about the 2.0T FSI: "It starts a whole new era," explaining, "For the first time, Audi combines direct injection for gasoline with turbocharging." Although this is a 2-liter, four-cylinder engine, it delivers 200 hp in a band from 5,100 to 6,000 rpm and 207 lb.-ft. of torque in a range from 1,800 to 5,000 rpm; Eiser describes it as providing "exceptional torque characteristics and excellent responsiveness."
Eiser says the exhaust manifold and turbine housing are one cast module. Consequently, the exhaust energy is immediately conveyed to the turbine for improved torque response. And the catalyst is located directly behind the turbocharger; the heat helps the catalyst do its job so the car has a ULEV rating. The FSI engine (similar to that used in the Audi R8: the car that has won at LeMans several times) called for what Eiser describes as "a totally new combustion system." There is a single-piston, high-pressure pump that provides fuel to the common fuel rail. There are newly developed high-pressure fuel injectors, a new piston bowl geometry, and new intake ports, all contributing to, Eiser says, "fast and efficient combustion."
The transmission is called the "Direct Shift Gearbox," or "DSG." Once again, this is a case of the TT-like nature of the A3, as the DSG was introduced on the TT in 2004. This transmission is one that combines, in effect, a manual gearbox and an automatic. It can be used (1) as an automatic by simply selecting, say, "D," (2) put in the Tiptronic shift mode for manual shifting, or (3) shifted via paddles mounted on the steering wheel. Trahan explains, "Anytime you are driving in a forward gear, two gears are mechanically engages—the same principle as a manual transmission." The difference is that there are two clutches. Only one is engaged at a time. When it is time for there to be a shift, the action of the two clutches is coordinated so that as one opens, the other engages. "There is never an interruption in the power flow," Trahan says. He adds, "This transmission is quicker and more efficient than a manual transmission."
What the Future Holds.
Moving forward, there will be an A3 available with a 3.2-liter, six cylinder engine and quattro all-wheel-drive in the first quarter of 2006, followed later in the year with the S-Line sports package.