Ethics Controversy
Although Audi Korea showed great sales performance by recording more than 40 percent growth this year, it is embroiled in consecutive moral controversies.
According to the Korea Automobile Importers and Distributors Association (KAIDA) on Nov. 9, Audi Korea's sales jumped up by 41.9 percent compared to that of the same period last year. The company sold 23,440 units from January to October so far. Only Mercedes-Benz and Jaguar Land Rover grew over 40 percent, with Audi among top 10 automobile importers.
Audi also shook off its label as the permanent fourth in monthly sales rank. In the past, Audi stayed fourth, following BMW, Mercedes-Benz, and Volkswagen. But it has now risen to third. If this continues, its annual sales is expected to surpass 30,000 units easily next year.
However, the problem is whether or not Audi is showing a proper fit for its performances. Recently, it was fined 94 million won (US$86,666) by the Fair Trade Commission because it didn’t post any notices on its blog after paying a maximum of 10,000 won (US$9.21) to popular bloggers to post promotional articles.
Previously, Audi was fined 1 billion won (US$919,960) by the Ministry of Environment (ME) in September for violating the Clean Air Conservation Act by using non-certified catalytic converters. The ME took strong action, contrary to expectations, by accusing Audi of “highly likely intentionality.” The three specific models related with the accusation are the 2.0 TFSI Quattro, A5 2.0 TFSI Quattro, and A5 Cabriolet TFSI Quattro, which sold 9,813 units in total, damaging its brand image.
Furthermore, Audi was labeled as an overstated mileage company by the Ministry of Trade, Industry and Energy (MOTIE) at the beginning of this year. The MOTIE reported a plan to impose fines, as its mileage of 4 imported cars such as the A4 2.0 TDI and Volkswagen Tiguan 2.0 TDI exceeded permitted mileage limits.
In terms of social contribution, Audi is showing contrasting behaviors compared to other German premium automobile brands such as BMW and Mercedes-Benz.
BMW has been conducting many corporate social responsibility activities since 2011, after founding the BMW Future Fund. For instance, it invested 77 billion won (US$71 million) to build a driving center in Yeongjong island of Incheon. Mercedes-Benz, criticized for its reluctance in social contributions, also raised 100 billion won (US$922 million) for a social fund and decided to implement 11 social responsibility programs with the money.