Audi’s A2 confounded the buying public and lost its maker billions, but it was a stellar achievement nonetheless.
Carmakers are for the most part, pathologically averse to matters of risk, and for good reason – the costs of failure can be ruinous. For instance, a cogent argument could be made that Fiat Auto never recovered from the commercial failure of their 2003 Stilo programme, precipitating a decline from which they have never truly recovered. Not so Audi, nestled safely within the VW Group mothership, and for decades now, a significant profit centre within the vast German multi-brand automotive titan. Nevertheless, the luxury carmaker is no stranger to the bitter tang of failure, or its financial cost.
Twenty years ago Audi announced the A2, a revolutionary and futuristically styled monopod aimed at elevating the Ingolstadt carmaker’s perception as technological pioneers. Six years later, it was summarily axed, following losses which amounted to around €1.3 bn*, having failed to ignite the enthusiasm of the marketplace. This places the A2 programme amongst the ten most expensive failures of the previous decade, but raw figures alone cannot tell the full story.
The roots to the A2 programme go back to the late 1980s and an environmental crisis which was precipitated by the massive depletion of German forestry from the effects of Acid Rain, a direct consequence of vehicle and industrial emissions. With the environment firmly on the political agenda during the decade that followed, carmakers were literally forced to act.
There had been for some time something of a gentleman’s pact amongst the German carmakers, where they agreed not to overtly encroach upon one another’s core markets. But as Mercedes-Benz sought to transition from their position at the patrician end of the automotive spectrum towards a broader demographic, their decision to produce a compact front-driven hatchback precipitated no little consternation along the banks of the Mittelandkanal.
By embarking upon the W168 programme, Mercedes essentially tore up the rulebook. Such a precipitous move into VW’s orbit was viewed by VW Group’s Dr. Ferdinand Piëch as a declaration of open warfare, one which would lead to wide-ranging ramifications.
According to an Audi spokesman, the programme brief for the A2 stated it should be capable of transporting four people from Stuttgart to Milan on a single tank of fuel, so the emphasis would be on lightweight materials, small-capacity fuel-efficient engines and an overtly wind-cheating shape – Ingolstadt’s aim being to create a small Audi, rather than a cheap one. In this respect at least, one could suggest it to have had more in common with Stuttgart-Untertürkheim’s W201 model in that it combined all of the virtues and refinements associated with the marque in a smaller package.
Audi’s engineers started with one pronounced advantage: Material technology. Having developed an aluminium structure for the upmarket A8 model, Audi’s engineers developed the architecture to underpin an advanced lightweight monospace bodyshell, where the outer panels were attached, largely unstressed to the alloy spaceframe.
When Audi previewed the A2 with the 1997 Al2 concept, timed to coincide with the crucial world debut of their bitter rival’s new A-Class, few realised the seriousness of their intent, assuming it to be merely a well-chosen dig at their antagonists. Two years later however, the naysayers were well and truly confounded.
Stylistically credited to Audi designer, Derek Jenkins, working under the supervision of Peter Schreyer, Audi’s design team created a masterpiece of form and surface. Appearing as though it had been hewn from a single billet of aluminium, its exquisite streamlined teardrop shape was a pared-back masterclass in visual and material purity – arguably the most intelligent car to ever bear the four rings of Auto Union.
While its Rastatt rival was in essence an engineer’s car clad in the ephemeral fashions of the day, the A2 was a stylistic and conceptual landmark. Its cabin too not only was clever, versatile and spacious, it was as finely wrought and elegantly specified as any contemporary larger Audi.
But this level of integrity came at a price. Costing well above a well-specified Golf, potential customers really had to make a case for the Audi. Combine the high cost of entry with small-capacity, low-output engines and it’s little surprise buyers baulked at the asking price. Most chose more conventional options, and the too smart for its own good A2 never troubled the sales charts, with a mere 177,377 built at Audi’s (former NSU) Nekarsulm facility until 2005.
Against its three pointed star rival then, the A2 may have been a sales flop, but it proved the more durable design – from a materials perspective, from a build and durability perspective (the original W168 being anything but a quality product), but more pointedly still from a design perspective – the A2 remaining an object of desire, whereas the A-Class’ faddish shape dated as quickly as its paintwork faded. And while the Mercedes (its million plus sales notwithstanding) remains something of an embarrassment to its maker, the A2 has maintained its credibility, at least amongst those who truly understand it.
Audi have paid lip service to reanimating the A2 concept a number of times in subsequent years – (most recently as an autonomous vehicle), but the concept lives on in Milbertshofen – BMW’s i3 illustrating the A2 concept’s prescience. However, while monopods remain showroom poison, it remains highly improbable that Audi will repeat the experiment, especially since Ingolstadt has not only proven its point, but also can achieve better returns with stultifyingly conventional Polo-based derivatives.
So can Audi’s monospace capsule simply be dismissed as a cost-no-object fit of Piëch? It’s likely that the A2 programme was viewed by VW senior management as an expensive but necessary thought experiment which came with the added benefit of demonstrating both technological superiority and commercial daring over their rivals. With this achieved, it was inevitable the focus would shift focus towards more cost-effective solutions.
An ambitious stab into the unknown then – one its maker would never countenance now, but not only was the A2 hugely significant as Audi’s turn of the millennium creative moonshot, but also as a point of reference (and reproach) for small cars ever since.
*Datasource: Bernstein Research via Automotive News Europe.
©Driven to Write. All rights reserved.
Author’s note: The original text has been altered to reflect the correct stylistic attribution – see commentary below. [17/07/19 18.52 GMT]
Driven To Write 
Audi used the A2 to show the world that an aluminium car could be made in large numbers. Its development was done in close cooperation with Alcoa (Alcoa had promised to pay 1bn $ to the car maker with the first aluminium car in large scale production – don’t know whether Audi ever got the money) who helped to significantly modify the A8 D2’s ASF. The number of parts was massively reduced in order to lower cost and simplify assembly and new connection methods were developed for the aluminium elements like glue free pull shrinking or punch riveting without drilling holes first. Without these modifications production of the A2 would not have been possible for the intended price and the new developments were later used on the A8 D3 and its successors.
Despite of this work the A2 was more expensive to produce than an A3 and as a result Audi had to avoid cannibalization of A3 sales numbers under all circumstances. To achieve this the A2 was so tall and so slim, both significant repelling factors for potential customers. Had the A2 looked more like a real car (perhaps like a Citroen GS) it most probably would have sold much better but would have cost Audi serious losses in profit.
The guy running our local post office has an A2. After his first was destroyed in an accident he looked for a new one for nearly a year and now has a rare 110 hp example for which he paid a lot of money but got a car that’s still looking brand new and has every conceivable extra.
“Despite of this work the A2 was more expensive to produce than an A3 and as a result Audi had to avoid cannibalization of A3 sales numbers under all circumstances.”
When a major concern becomes that a new model cannibalizes sales from existing models, usually they needn’t have worried – the new model is an almost certain sales fiasco !
It is difficult to introduce a successful new model. Plenty of best efforts by automakers fall short. If they are pulling their punches for fear of “cannibalizing sales”, failure is almost inevitable.
If the risk is cannibalizing sales a better question would be: “why are we doing this anyway?”
With today’s silly model proliferation it’s almost inevitable that sales numbers get cannibalized. An Audi ‘allroad’ almost certainly cannibalizes sales numbers of the standard estate but it sells at a higher price and therefore delivers more profit at roughly the same production costs.
With an expensive to make A2 cannibalizing the cheap to make A3’s numbers profits would have shrunk.
A similar deliberate limitation of sales numbers happened with the Toyota Prius Mk1 which sold at a loss and therefore had to be sold in limited numbers.
The A2 was a similar technological showcase and it helped to re-develop design principles and production processes of Audi’s ASF which also were used on the A8.
Leaving aside the undoubted merits of the A2 for a moment, Angel’s rhetorical question is highly relevant today when manufacturers like Mercedes-Benz and BMW are expanding their already bewildering ranges with micro-niche products such as the SUV-coupé and four-door coupé models. In these cases, the only plausible answer to Angel’s question has to be “because they’re going to make one”. Madness!
Meanwhile, a “mainstream” manufacturer, Ford, is apparently cutting back on its European range significantly. The Edge is dead, and the Mondeo, S-Max and Galaxy will be replaced by a single new estate/crossover model. It looks good in an unofficial rendering and, hopefully, will not go the way of the conceptually similar Opel Signum or 2005 Fiat Croma. If so, then one might be tempted to buy one for the growing exclusivity of the Ford badge.
If Dave is correct, it’s something of a tragedy that the A2 was deliberately designed not to cannibalize A3 sales. I’m a huge fan of its looks, but would love to have seen the A2 enginering and design applied to a conventional C-segment hatchback, to provide a proper, more sophisticated, substantive (and more expensive) alternative to the Golf. The A3 was/is little more than a Golf in its Sunday best, and it’s a moot point as to whether it was/is more attractive than the Golf in any event.
The original A-Class was a fascinating concept, executed terribly. I remember the first time I sat in one, and my horror at seeing (and feeling) the Fisher-price quality dashboard and switchgear.
Thanks for reminding us of this fine car, Eóin! It’s still the only Audi I’d ever consider buying (and if I look at the prospects for the next years, it will keep this place).
The turn of the century for me is also the zenith of what I think Audi should be: a car maker for engineering-led vehicles with an elaborate, no-nonsense design. The C5 (A6 from 1997) and B6 (A4 from 2000) were in the same line, and probably also the first TT. Then it all went down with the advent of ever flashier cars with aggressive single frame grilles and useless design gimmicks (as seen in the B7 reskin of the A4).
The parallel with the BMW i3 is something that never occurred to me, but I think it’s true. Both are concepts that demonstrate what a car maker could do when they free themselves from too conventional thinking, but finally the effort isn’t honoured by the buying public. And like the A2, the i3 could be dismissed too soon and be replaced by something meaningless or nothing at all.
The A2 is indeed a charming and appealing car.
But all-alloy construction for mass-produced cars looks like an expensive folly. Today’s mixed-material platforms are no heavier but more space efficient and cheaper to make. Building a city car on an all alloy spaceframe is madness.
I had an A2 for several years (also tragically written-off in a prang – insurers didn’t like organising or cost of ALU repairs) and it was fantastic. A little underpowered, but sorted with a remap that not only took power from 75hp to about 110hp, but also improved economy if driven thoughtfully. Some variable dampening shocks sorted the stiff teutonic autobahn-tuned factory suspension and it was all the car I ever needed, happy to go down to B&Q or schlep 500 miles in a day to see my folks in france without missing a beat. It was meant to be our forever car, and I still frequently browse Autotrader looking for low mileage unicorn models.
The looks are still so fresh – the Bauhaus aesthetic even more prominent than its contemporary TT—and the interior appointment was exemplary. Great features like easily removed rear seats (a couple of clips) and you had a van of similar size to a Caddy. Battery was in the boot for better weight distribution , and the double-level ‘hidden boot’ (in cars without a spare) was bigger than an A3 or Focus.
Other brilliant detailing I recall – a wee little sunshade above the rear mirror, just for the little gap above it, two voluminous cubby holes in the false floor under the mats (one used for the ECU and loom) but also great for smuggling Rebel Freedom fighters, contraband or things like Motorway Gillet Jaunes, The amazing dual folding Glass roof, the unopenable bonnet (Which was – with just two clips) and little slots that you could put the seatbelt clips into to stop then clanking about when not in use.
It’s a shame they didn’t ever get to do a mk2. If they had the only gripes I think that could have been smoothed out in a new model were better A-Pillar visibility (a factor in my collision for sure) road noise and things missing like cruise and auto options. And better rubberised paint on the soft-touch buttons – ours was second hand (could never have afforded one new off the lot) and the previous owner clearly had long manicured nails that had scratched off a lot of the icons on the AC, window lift and light switches
Audi have been teasing us with ‘new’ concept A2s for years now – almost as badly as VW have with their with Microbus concepts, and the ‘Electric A2″ from about 8 years ago looked like a near-factory ready follow up, sadly never seen again. This year they showed another autonomous EV that supposedly carried the baton of the original but it was the worst misunderstanding of what the original stood for that they could have possibly imagined and pretty much sealed my notion that Audi’s design ethos is broken and does not understand why people buy their cars.
If the TT was the car that made Audi the ‘design car brand no.1′, the A2 constitutes Ingolstadt’s definitive work to those of a more intellectual inclination.
Another parallel between these two cars would be that the credit for either design was and remains hotly contested.
So just as Freeman Thomas’ authorship of the TT can/should be disputed, Luc Donckerwolke’s input into the A2 appears to be somewhat exaggerated. If any single designer ought to be credited for the car’s exterior shape, it’s more likely to be Derek Jenkins, who came up with the original design at VAG’s California studio. Donckerwolke’s main contribution was getting the design ready for series production.
There is a (probably apocryphal) legend that when the A2 came out, Ford Germany bought one, disassembled it and mounted the most choice parts on the wall of a factory canteen like a dinosaur at the Natural History Museum — such was the admiration for the packaging and next-level design of the thing.
I found this piece on the A2 of great interest.
Particularly as I was talking to a chap at last years “Audi in the Park” event who seemed to know everything about the development of this incredibly forward thinking piece of automotive design.
Based on his explanation ( he was working as an exterior designer in Audi Design at the time) the Design of the A2 should be accredited to the designer Derek Jenkins.
It was explained to me that the Al2 concept was actually a teaser type concept quickly developed to prepare the public for the impact of the final production design presented a little over 1 year later.
This Al2 concept was in fact the responsibility of Luc Donckerwolke, apparently it had a much slimmer d- post than the just to be signed off production design which it was based on, this area was then subsequently changed on the finalised design to echo the look of the concept window graphic, which obviously improved the rear side visibility.
No doubt there is hardly ever just one Designer wholly responsible for the aesthetics of a modern production design.
But as the A2 represented a design development process of unusual complexity;
weight saving, packaging, cost as well as aerodynamics it seems only fitting that Derek Jenkins should be recognised as the true creative brains behind the shape of this extrordinary vehicle.
Interestingly being the designer responsible for the Lucid EV, he was interviewed in a recent edition of Car magazine where he claimed that the A2 was the design that up till now he was was most proud of!.
Let the truth be known
My grateful thanks to Christopher and PeterT for the correct attribution of stylistic responsibility. I will amend the text accordingly, so that the talented Mr. Jenkins receives his due accord.
You should consider a follow-up piece on the A2 ‘3l’, the ultimate expression of Piech’s lightweight concept, and a ‘sliding door’ moment that rejected in favour of 2000kg ‘Sports’ utility vehicles.
Thanks for your comment Charles. I’m not entirely sure I’d agree with that statement however. There is the 2013 VW XL-1 to consider if we want to talk about ultimate expressions, I would contend. Undoubtedly, the subject of Dr. Piech’s 1-litre programme is one we’ll get around to in the fullness of time.
Meanwhile, I hope you are enjoying the DTW experience.