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Audi’s Newman: “Simplicity should be seen as the guiding principle.”

HANOVER —Audi’s digitalization chief said the premium carmaker aims to focus on “a limited set of profit pools” as it adapts its business strategy to changing market conditions.

John Newman, Audi’s head of digitalization, told the carIT Congress here that the auto industry is facing a broad range of disruptive market forces. These include trends such as commoditization, new digital customer segments, autonomous driving, the growing strength of new competitors and the persistent threat of cyber attacks.

Against this backdrop, Newman said the carmaker will focus on new vehicle sales, aftermarket parts, used vehicles and the prevention of accidents.

The Audi executive said all processes around the brand should be “effortless.” That includes, owning and operating a vehicle, repairing or re-selling it. “We will have succeeded with digitalization when we make premium mobility effortless,” Newman.

Newman said Audi looked closely at companies that have already been successful in the digital economy. These stand out by “going after large existing profit pools;” migrating existing customers to new business areas; and focusing on “a handful of products and services.”

He also said these companies intensively deploy digital platforms, value speed and have country-specific strategies.

Taking its cue from these digital champions, Audi is keen to regionalize some of its offerings. “What works in China may not work in Silicon Valley and what works in Silicon Valley may not work in Europe,” Newman said.

A focused and relatively simple strategy holds the key to success in digitalization, he added. “In view of the immense possibilities of digitalization, it is all the more important to see simplicity as the organizing principle.”

-By Arjen Bongard