AUDI'S FIRST TRUE SPORTS CAR: GRRRR8!
At long last Audi announces the R8—a two-seater that brings the brand's Le Mans–winning capabilities to the street.
By SUE ZESIGER CALLAWAY

(FORTUNE Magazine) – Just look at this!" exclaimed Seal, gesturing at the new Audi R8's carbon-fiber midsection stripe. "It gives the car a unique identity, it highlights that it's a mid-engine sports car, and it separates the passenger and mechanical sections of the car. No other car has such a visual device."

Although the Ferrari-owning pop artist (and Mr. Heidi Klum) may have attended the Audi launch as spokesman, his passion was nonetheless real—and well placed. For Audi, long thought of in the U.S. as a builder of highly engineered but slightly bland sedans, the R8 is an aggressive image changer. "Cars like the R8 will help redefine Audi's image in the U.S," Martin Winterkorn, the new head of the VW Group (Audi's parent company) told me. "My target is to sell 200,000 vehicles here within five or six years." (Last year Audi sold 90,116 cars in America, only 10% of its global sales.)

I have to applaud Audi: Every once in a while a car company goes against its own value and volume logic for the greater good of the brand. In other words, it produces an icon vehicle that will put it on the high-end map. Achieving a successful halo car takes enormous R&D commitment, a staggeringly great design, and blood-pumping performance.

Et voilà! The R8 shares some developmental DNA with the Lamborghini Gallardo and with Audi's Le Mans–winning racecar, also called the R8 (gene pools no one should argue with). Though relatively diminutive, this R8 has an aggressive road stance that wows on sight. With a menacing scowl on its chiseled face, dagger-throwing LED-accented headlamps, holy-hell air intakes, and a back end prominent enough to make J.Lo envious, the R8 has unique road presence. Inside, the cockpit is sumptuous and deceptively simple. An arching hoop (particularly nice in carbon fiber or piano black, two of the options) surrounds the driver's controls, focusing you on the task at hand: speed.

I drove the sexy beast in two settings: first, Nevada's Valley of Fire, where empty twisties allowed me to push the R8 and tickle its top end, to 187 mph. The car's 420-hp V-8 yowled behind me as I tick-tick-ticked the gearshift through the beautifully machined metal gate. (Paddle-shift is available too.) The R8 handled superbly, but was it aggressive enough to let me scare myself?

To answer that question, I headed to the Las Vegas Speedway, where Audi had coned off a one-mile course in the infield. When the German track hand gave the signal, I dropped into first gear and began a slalom. The R8's tires squealed but held on tight. Through sweeping corners and tight turns, the car was quick and capable. In order to let play preside, the car's redline is a rollicking 8,250 rpm, with 317 foot-pounds of torque available from 3,000 rpm to 7,500 rpm (can you say testosterone playground three times fast?). Best of all, the R8's traction-control system, which I had not (yet) shut off, allowed me a bit of controlled drifting. I wasn't scared, I was delighted—but my passenger was alarmed; he begged me to let him out. By the straightaway and braking zone, I was sure: A star is born.

I'd like to tell you that the R8 has an overt personality, but it is so refined it evades standard definitions. It is subtler than its sibling the Lamborghini Gallardo, which is a teenager on steroids. The R8 manages a better all-around ride quality than its distant cousin the Porsche 911, in which a driver can practically taste the tarmac. And the R8 is better mannered than mid-engine Ferraris, bless their high-strung hearts.

The R8 is also—surprise, surprise, for such a high-tech company—100% hand-built; 75% of the body is handmade, and it is assembled at Audi's Neckarsulm factory. There are 325 feet of hand-done welds on the aluminum frame, and the entire engine bay (open for viewing like the Ferrari F430) is swathed in carbon fiber and lit at night like a fine sculpture. Frankly, given the high level of craftsmanship, it's surprising that Audi doesn't charge more than $115,000.

"The Audi guys have been trying to build a sports car for 25 years—this has been a long wait," Winterkorn told me as he flogged the R8 around the track. I asked him, yelling to be heard over the engine's snarl, what impressed him most about the car. "That anyone can drive it"—he glanced at me—"even a woman." If Audi wants to conquer America, it had better get a mindset adjustment: Next time, Herr Doktor, I'll drive.

Winterkorn and Rupert Stadler, Audi's new boss, confirmed that the next step for the R8 is to get a bigger engine. Eventually, says Winterkorn, it will share a new platform with Lamborghini, Bentley, and (hooray!) Bugatti. But for now, Audi can rest easy in the knowledge that it has created a classic.

Sports Stars Here's how the new Audi R8 stacks up against the competition

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Market indexes are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer LIBOR Warning: Neither BBA Enterprises Limited, nor the BBA LIBOR Contributor Banks, nor Reuters, can be held liable for any irregularity or inaccuracy of BBA LIBOR. Disclaimer. Morningstar: © 2014 Morningstar, Inc. All Rights Reserved. Disclaimer The Dow Jones IndexesSM are proprietary to and distributed by Dow Jones & Company, Inc. and have been licensed for use. All content of the Dow Jones IndexesSM © 2014 is proprietary to Dow Jones & Company, Inc. Chicago Mercantile Association. The market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved. FactSet Research Systems Inc. 2014. All rights reserved. Most stock quote data provided by BATS.