Sunday, 25 October 2015
Profits fall off a cliff at Bentley
Profits at Bentley Motors, owned by Volkswagen AG, fell dramatically in the 12 months to 31 December 2014.
As sales for the year held steady at £1.4 billion, it would seem that additional costs have eaten into the company's profit margin.
Profits slumped 75 per cent from £181 million in 2013 to £46.4 million in 2014. In 2012, profits of £108 million were declared.
The company has seen a rise in car sales from 10,120 in 2013 to 11,020 cars, but on the debit side has had to take account of an investment of £150 million to add manufacturing capacity at its Crewe, UK site to cater for new models.
Principal among these is the new Bentayga luxury sports utility vehicle, the base version of which is set to retail at over £160,000, making it the most expensive SUV. Bentley is a company not afraid to admit to high prices.
Nor is it afraid of making bold statements. At last month's Frankfurt motor show, it pronounced of the new car: "The Bentley Bentayga combines unparalleled luxury with effortless performance and everyday usability."
Then it added: With an "all-new twin-turbocharged 6.0-litre W12 powertrain", the Bentayga is the fastest, most powerful, most luxurious and most exclusive SUV in the world. It offers a true Bentley driving experience and showcases a range of innovative technology features.
The gasoline (no sign of a diesel) will develop 600bhp (447kW) between 5,250 and 6,000 rev/min and 900Nm (664lb ft) torque from the 5.95-litre engine.
At the moment, it remains to be seen just how much of the W12 engine will be "all new".
Bentley has added 400 employees to its payroll, further adding to the cost base.
In the latest Ricardo Quarterly Review, Q£,2015, Ricardo notes: “In engineering terms, particularly when it comes to super-luxury SUVs such as the Bentley Bentaygo SUV and it upcoming Aston Martin and Rolls-Royce rivals, vast technical resources are being brought into play too enable the vehicles to meet the exacting – often conflicting – customer requirements of supercar dynamics, limousine-like comfort, and the ability to tackle rocky mountain tracks, muddy fields and desert sand dunes without breaking sweat.”
Ricardo describes the Bentaygo as “the first entry into the super SUV segment that is expected to bring handsome rewards”.
No doubt, some of the fall in Bentley Motors’ profit can be attributed to the ‘vast technical resources’ that are being deployed to bring the vehicle to market.