crewe Luxury always works. Car manufacturers usually console themselves with this self-assurance in times of crisis. For the British luxury brand Bentley, however, this is more of a new experience: in 2018, the VW subsidiary wrote a three-digit million loss and had its back to the wall. “This year is the most successful year in our history,” says Bentley boss Adrian Hallmark today.
The company has reduced costs by a quarter and increased sales by 40 percent over the past four years. With a volume of 15,000 luxury cars per year, which cost an average of more than 200,000 euros, the plant in Crewe in northern England is working to capacity. The company is debt-free and will use cash flow to fund its £2.5 billion investment plan, the boss said.
With a profit margin of around 23 percent, Bentley should now also be one of the earnings pearls of the VW group. In the first half of 2022, the English subsidiary made a profit of almost 400 million euros – that’s more than in the entire previous year.
According to the manager, the company has also coped well with the consequences of the British exit from the EU. “Brexit didn’t hurt us,” assures the 55-year-old, estimating the additional administrative costs for the company at just around six million pounds a year.
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For the UK, however, the Brexit balance sheet looks much worse: “There is no question that the direct or indirect displacement of hundreds of thousands of productive, willing workers from the labor market has led to bottlenecks in hospitality, logistics and all kinds of industries. All of this reduces economic activity.”
No IPO planned for Bentley
The luxury brand itself, on the other hand, is developing well. However, Hallmarkt does not see Bentley going public like Porsche in the foreseeable future. “Nothing is planned. Never say never, you never know. But that’s not the plan,” said the Brit to journalists in Crewe.
When Ferdinand Piëch acquired the luxury brand in a bidding war with BMW in 1998, hardly anyone believed that the purchase could become anything more than a hobby for the legendary Porsche grandson. Piëch was later asked by the critics why he had spent more than a billion Deutschmarks on Bentley. “6 minutes 48 seconds,” he replied, reports Hallmark. That was the lap record with which the legendary Bentley “Blower” had surpassed the Mercedes competition in the 1930 24-hour race at Le Mans.
Today, the racing car sits alongside 17 other models in the newly built Heritage Garage in Crewe and is considered the world’s most expensive Bentley, with an estimated collector’s price of more than £20 million (32 million euros).
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However, the secret to the success of the turnaround is not just savings and productivity gains at Crewe. The image of Bentley lives on from the manual work, and so there is only one robot in the assembly. It takes up to 130 working hours to assemble a luxury car. It took 30 mechanics more than 13 hours to manufacture the legendary 12-cylinder engine from almost 300 individual parts.
Electric instead of 12 cylinders
However, this means that only a quarter of all Bentleys roll off the assembly line in Crewe. The new top model “Batur” will initially be offered with a 730 hp 12-cylinder combustion engine. It therefore seems a bit strange that the “Batur” is also intended to mark the transition to the electric age.
“By 2030, we will only build vehicles with electric motors,” promises Hallmark. One in five new Bentleys already has a hybrid engine. “We will certainly lose some customers as a result,” says the Bentley boss, who has been running the company since 2018. However, most of them will be convinced.
In the important Chinese market, Bentley’s electric strategy is likely to find sympathetic ears. It could be more difficult for some customers from Arab oil states.
Engine production at the Bentley factory in Crewe.
(Photo: Bloomberg)
In any case, Hallmark doesn’t believe that the image of the luxury brand depends on the hum of a 12-cylinder engine. The real recipe for Bentley’s success is the custom-made products according to the very individual wishes of the customers. For this purpose, the company has set up its own production under the name of the former coachbuilder Mulliner, which looks like an exclusive inventor’s workshop and, according to Mulliner boss Paul Dickinson, “does almost everything the customer wants”. Even a pink interior has already been installed.
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Car door side panels in Indian stone or 5000 year old dark East Anglian riverwood – no problem. That can cost an extra £5,000 per door. Only skins from Scandinavian bulls are used for the leather upholstery in the Bentleys. “The leather isn’t stretched by pregnancy compared to cows and has less bug bite imperfections,” said Bentley spokesman Greg Drury.
More than 712 stitches account for each diamond diamond sewn into the highest quality Mulliner models. But the customer then has to put more than 71,000 pounds per seat on the table.
Custom orders for the super rich are the key to success
“Every car is unique,” says Mulliner boss Dickinson. In front of him, hidden under a tarpaulin, are three custom-made special models from the luxurious “Bacalar” convertible series, which customers will be collecting in the next few days. On the opposite wall, nine of the twelve frames for pictures from the strictly limited series are still free. Depending on the features and model, the toys of the super-rich can cost well over a million pounds.
For the coming year, Bentley boss Hallmark wants to step on the brakes. “We don’t want to flood the market,” he says, pointing out that orders in China have suffered somewhat as a result of the lockdowns there. Overall, however, Bentley came through the current crises well, although the war in Ukraine had meanwhile brought the company to the brink of a production stop that threatened its existence.
Bentley sources wiring harnesses from Ukrainian suppliers and feared having to shut down production for months. “If you can’t work for four or five months, you’re basically bankrupt,” says Hallmark. But the British were also able to master this bottleneck.
More: Farewell to the combustion engine: Mercedes is converting its most important engine plants to electric from 2024.