Audi India plans to locally assemble 80 per cent of its models to avoid the high import duties on cars. At present, it manufactures the A6 and the latest A4 variant at its Aurangabad plant.

“We will be locally assembling 80 per cent of our portfolio,” Audi India head Balbir Singh Dhillon said at the launch of the entry level sedan A4 in India on Tuesday.

Dhillon said the luxury segment was taxed heavily at 50 per cent, which includes the 28 per cent GST and the 20-22 per cent cess.

The high taxation “keeps the penetration of luxury cars in India low at 1 per cent while it is significantly higher in other neighbouring south east Asian countries”.

The company, which had to delay the launch of its entry level sedan because of the pandemic, has given a bigger engine to the fifth generation A4, which it hopes will lure customers away from cars with a diesel engine.

Earlier, the A4 used to sport a 1.4 litre engine. Audi has discontinued its diesel programme in India following the BS-VI regulations. “We are not feeling the heat of not having diesel among our models. Even for our SUVs such as the Q8 and Q2, the petrol variants are selling rather well,” said Dhillon.

Audi, which launched five products in the pandemic year, will continue with its launches this year too, starting with the A4 that will retail at Rs 42.34 lakh, ex-showroom.

“We will launch a number of models which will be a combination of sedans, SUVs, sports cars with ICE and electric engines. We will launch our first EV, the e-tron soon,” said Dhillon.

The company is expected to add A3, Q3, Q5, Q7 to its lineup this year.

The A3 when launched will become the new entry-level car for Audi and is expected to be a volume driver.