Luxury car wars: Audi's £19bn plan to beat BMW

 
Emma Haslett
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Investments include a new Mexican manufacturing plant, at which the Q5 will be produced (Source: Getty)

Audi has unveiled a five-year plan to steal BMW's crown as the world's biggest luxury car maker.

In a statement, the company said it will spend €24bn (£19bn) - €2bn more than originally planned - over the next five years.

The German company, which is owned by Volkswagen, said €16.8bn - 70 per cent - of the total will go on developing new models, including the Q1, a "baby SUV" due to be launched in 2016.

By 2020, the company wants to have increased the total number of models it produces from 50 to 60, and stolen BMW's place as the luxury car brand with the most sales in the world. It's already a close call: in the first 11 months of this year, BMW sold 42,600 more cars than Audi, down from 54,600 a year earlier.

More than half the cash it's set aside will go to its German factories in Igolstadt and Neckarsrulm, which currently account for over half Audi's output.

However, it's also spending more than £1bn on new factories in Mexico and Brazil, hiring another 850 workers in Mexico, where the Q5 (another SUV) will be made, suggesting a shift in focus towards developing economies.

But despite its grand plans, chief financial officer Axel Strotbek sounded a note of caution.

Despite the growth in total investment, we will keep a watchful eye on the upcoming challenges and exercise the required cost discipline.

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