diesel death

Audi Quits Le Mans to Focus on Electric

  • Why it matters

    Why it matters

    The Dieselgate scandal has tainted VW’s stable of diesel car brands, and the firm is also keen to shift customer attention to e-cars.

  • Facts

    Facts

    • The prestigious Le Mans event challenges cars and drivers to race non-stop for 24 hours.
    • Audi has won Le Mans 13 times since 1999 and viewed the victories as proof of its strength in diesel technology.
    • But the firm plans to start mass production of electric cars in 2018 and wants one out of every four cars its sells to be electric by 2025.
  • Audio

    Audio

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Le Mans 24 Hour Race
Audi has enjoyed huge success in the Le Mans 24-hour race. Source: Getty

Victory at the legendary 24-hour endurance race in Le Mans, France, is the ultimate achievement for auto engineers and executives, and Audi, the luxury unit of troubled auto giant VW, has savored it no less than 13 times since 1999.

For Chief Executive Rupert Stadler, those moments of glory served as proof of Audi’s famous advertising slogan “Vorsprung Durch Technik” — “Progress Through Technology.”

But then another VW subsidiary, sports car firm Porsche, won the race in 2015 and 2016. Some say that the 2015 triumph was seen as so important that it qualified Porsche’s boss, Matthias Müller, to take the top job at VW last September. He succeeded Martin Winterkorn, who was forced to resign as chief executive over the Dieselgate emissions scandal that erupted that month.

Mr. Müller, who also became the supervisory board chairman of Audi, is said to have been the driving force behind Audi’s exit from the race, announced by Mr. Stadler on Wednesday.

Public interest in Le Mans wasn’t deemed commensurate with the huge expense of taking part.

The move will save Audi almost €300 million ($328 million) a year, about as much as Porsche invests in endurance racing. VW can ill afford having two of its subsidiaries go to such expense when it faces tens of billions of euros in costs from fraudulently fitting 11 million diesel engines with software designed to cheat emissions tests.

A U.S. judge on Tuesday approved a $14.7 billion compensation package covering 500,000 VW cars in the U.S. and the group faces further lawsuits that analysts said could raise the total cost of Dieselgate to as much as €30 billion.

Cost isn’t the only reason for pulling out of endurance racing — Audi’s racing cars were fitted with diesel engines and the victories at Le Mans were intended to prove its strength in a technology that has been thoroughly discredited by the fraud at VW. Many believe it has sounded diesel’s death knell.

In addition, Audi was put at a disadvantage in the race by recent rule changes that forced it to make its fuel tanks smaller, which robbed it of its advantage in fuel consumption.

Besides, public interest in Le Mans wasn’t deemed commensurate with the huge expense of taking part. To be sure, hundreds of thousands of people make the pilgrimage to the circuit in central France each June. But despite its prestige, it’s predominantly a local event and doesn’t feature prominently on television or in social media. And there’s not much interest in the event in the U.S. or China.

Audi has long been working on an alternative that is both cheaper and more forward-looking. “We’re going to contest the race for the future on electric power,” Mr. Stadler told the glum team of 350 engineers at Audi’s racing center in Neuburg an der Donau in southern Germany. “As our production cars are becoming increasingly electric, our motorsport cars, as Audi’s technological spearheads, have to be even more so.”

Audi had announced in early September that it plans to increase its involvement in the FIA Formula E Championship that uses only electric-powered cars. The firm is already cooperating with supplier Schaeffler and the ABT racing team.

Launched in 2014, Formula E is entering its third season and aims to boost mainstream acceptance of battery cars. It allows automakers to develop electric technology and market it to a global audience. Races are held in cities including Berlin, London and Beijing.

Audi hopes the race will attract interest by offering new forms of audience participation. Unlike Formula One racing, Formula E has an interactive element: ahead of each race, fans can vote via social media for which driver should get an extra electric power boost during the race.

The carmaker said it was also looking into expanding its participation in the World Rallycross Championship where it said the “exciting subject of electrification” was also on the agenda.

Audi plans to start mass production of electric cars in 2018 and wants one out of every four cars its sells to be electric by 2025. That strategy will only succeed if the company can impress its customers with strong racing performances, said executives at its headquarters in Ingolstadt, southern Germany.

Rival Porsche has similar ambitions with its “Mission E” plan to produce the best electric car in the premium segment. It also plans to get into Formula E racing, with reports that it has applied to become an official battery supplier for the event — meaning it could end up propelling Audi cars.

 

Markus Fasse covers the aviation and automobile industry for Handelsblatt. Stefan Menzel is the managing editor of Handelsblatt’s website and closely follows the car industury. To contact the authors: fasse@handelsblatt.com, menzel@handelsblatt.com

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