The FINANCIAL — Unbearable traffic jams and numerous numbers of vehicles are present on the streets of the Georgian capital. However due to the relatively weak social environment in the local market the majority of them appear to be automobiles targeted at mass-market consumption. The luxury automobile brands that rarely feature on Georgian roads are mostly imported.
Company reported operating profit increase by EUR 18 million. 13.1% to a new operating profit record of EUR 155 million.
“Our record performance has been driven by continuing emphasis on product development as well as growth in all markets Annette Koch, Bentley Motors Communications & PR Manager, Europe Central, told FINANCIAL. “The introduction of the Continental GT Speed, the fastest ever Bentley as well as the continuing popularity of convertibles such as the Azure and Continental GTC helped us achieve a record 10,014 car sales last year. This volume gives us good profitability as well as safeguarding our brand exclusivity which is key to our long term success.
These results reflect Bentley’s record sales performance last year when the company surpassed the 10,000 unit mark for the first time. Global sales increased by 7% in 2007 to reach 10,014 units. Increases were seen in almost all major markets: +7% in the UK, +4% in North America, +7% in Europe, +18% in the Asia Pacific region and 93% in China alone.
”Our marketing strategy is broadly similar across the globe and rests on our ability to deliver to our customers cars which offer a combination of modern technology, craftsmanship and bespoke capabilities and which in turn assure Bentley as one of the most desirable brands in the world. Our customers are all individuals with a high net worth and our marketing strategy seeks to offer them each a unique experience irrespective of where they live in the world”, Annette Koch says.
Bentley Motors regional offices are based in the UK, USA, Germany, Japan, Singapore, China and in the Middle East. In 2007 the company was a success in growth across both the Arnage and Continental ranges.
”In 2008 we are looking to consolidate our recent growth in all our existing markets. This will mean expanding our network in both established markets such as the US as well as newer markets such as China and Russia. For instance, this month we will be opening a new showroom in St. Petersburg and in quarter 4 in Bucharest, Romania”.
Sales grew by 45% in the Arnage line, whilst the Continental family sales increased by around 5%, with the GTC convertible proving to be the most popular model.
Model price varies by market as they are the product of a number of different factors most obviously local taxation.
Bentley Car Pricing Retail before taxes
2008 Model Year EUR
Continental GT Speed 172,900.00
Continental GT 151,200.00
Continental Flying Spur 149,700.00
Continental GTC 166,100.00
Arnage R 227,800.00
Arnage T 240,500.00
Arnage RL 264,400.00
Azure 284,900.00
Brooklands 290,000.00
“We do not disclose income by model or market”, Annette Koch.
Commenting on these financial results, Bentley Chairman and CEO, Dr Franz-Josef Paefgen, said: “2007 was a milestone in the history of Bentley as we passed the 10,000 unit mark for the first time. Five years ago we were selling only 1,000 units but the development of a strong product line has seen the company attract new customers in greater numbers. 2007 saw strong growth both in mature markets, such as Germany, the UK and the US, as well as in emerging markets, such as China and Russia.”
Bentley sales in Russia, 2008
“With Mercury Group we have a professional partner for both our Bentley showrooms in Moscow and, from this month onward, in St. Petersburg. We were very pleased with the sales performance in Russia in 2007 with more than 200 units sold. We expect sales to be around the same level this year”.
Recently Bentley Motors is poised to become the largest shareholder in HR Owen, the car dealership that sells more of the luxury vehicles than any other. HR Owen confirmed that Bentley had agreed to buy 27.9% of the company which owns the Jack Barclay franchise in Mayfair’s Berkeley Square, the world’s oldest and largest Bentley dealership.
“Bentley today is based on a history and tradition that has evolved from values laid down when the company was founded in 1919. The Jack Barclay showroom in Berkeley Square epitomizes this and we have been considering for some time how we could involve ourselves more directly in preserving its heritage for the long term and this opportunity recently and unexpectedly came our way in the form of a share acquisition. We believe it is in the best interests of the HRO business and will help to stabilize its future prospects. We have no intention of further increasing our stake.
Bentley Motors is represented by 173 dealers worldwide; 28 in the UK, 45 in the USA and 14 in Asia and Australasia among others.
What’s your vision of Bentley sales in the Caucasus region and in Georgia in particular?
“We have a strategy for considered and well-planned retail development. As stated above, 2008 will see the opening of Bentley St. Petersburg and Bentley Bucharest will grow from a service point into a fully authorized dealership. However, we have no plans to open a dealership in Georgia in the near future”.
“The “luxury car” sector is quite complicated to define. For Bentley, our positioning is very much in the high luxury segment. When we launched the Continental, we were in a position where there were no direct competitors. However, over the past 5 years, other manufacturers have sought to enter this segment, most notably Aston Martin, Ferrari, and Mercedes. Similarly with our Arnage range we are seeing competitors gradually entering this segment (over EUR 200 thousand) including Rolls Royce”.
Q. What’s Bentley Motors’ market shares in the market of luxury cars globally?
A. Given the complexity of the luxury car market (see answer above) this is difficult to define. Furthermore, our customers may often buy other high end luxury cars as well as a Bentley. We could say however, that for the High Luxury segment, we are one of the most important brands in this segment with around half of all cars sold whose value is over EUR 150 thousand.
Q. Volkswagen has been operating an official representation office in Georgia for 10 years already. What’s Bentley’s marketing policy like in relatively small countries like Georgia?
A. We very much focus on direct marketing activities and events where we build a one-to-one relationship with existing and new customers. The unique customer experience from the first contact with the brand to after-sales services is a cornerstone of our marketing. This does not differ from larger markets like the US to smaller markets like Latvia.
Q. How impressive are Bentley sales statistics in the country and which are the best selling models?
A. As we do not have an authorised Bentley dealership in Georgia, any Bentleys you may see on the road have been imported.
Q. “British authenticity is in our history – and in our blood”, is said in the company’s vision. What are the basic advantages of Bentley Motors compared to the other British auto producer giant BMW?
A. We do not compare ourselves directly with competitors either British or otherwise as we believe we offer our customers a unique experience. The combination of modern technology, craftsmanship and bespoke capabilities is unique to Bentley and makes it one of the most desirable brands in the world and a symbol of British automotive excellence. In our own way, we do represent British authenticity.
Bentley Motors was founded by W.O. Bentley in 1919 when the first Bentley engine burst into life at New Street Mews, London.
“ We are extremely proud of our history as it is this heritage which so heavily influences our company’s vision. The oldest Bentley still in existence is the Exp 2 – the second car made by W.O. Bentley in 1920. This car is housed in our heritage collection here in Crewe and its value to us is priceless. Other models produced throughout the years are in great demand both for private collectors as well as museums and other institutions. The cars can fetch enormous sums at auction with one last year – a 1930 Bentley Speed 6 – reputedly changing hands for GBP 2.8 million”.
Q. If we had mission statements in those days, it could not have been expressed more eloquently than in the words of W.O. himself, “To build a good car, a fast car, the best in class”. What are the company’s mainstream priorities of today?
A. The words of W.O. Owen neatly encapsulate our vision. Today’s priorities have changed little although we do recognise that we must also address some of the challenges facing the automotive sector as a whole, especially in terms of safety and the environment where we are seeking to reduce the impact our cars make whilst also minimizing the demand for fossil fuel-based energy. For this reason we announced at the Geneva Motor Show this year our environmental strategy which sets out how we will tackle these twin challenges over the next few years.
Q. “The six-time success at Le Mans has made Bentley more than a car – it has come to stand for a way of doing things: with spirit, flair, courage, instinctive intelligence and teamwork. Endurance racing has always been a way for us to test, strengthen and improve the cars,” said the company. What’s been your policy in terms of establishing such a strong branding awareness campaign for Bentley?
A. It is true that Bentley has a strong heritage that goes back to its beginnings, and a key element of branding is staying true to this heritage and tradition. This is embodied above all in each Bentley model, in the combination of power, performance, design, craft and refinement that each offers in its own way. The return to Le Mans and victory in 2003 also helped to breathe new life into Bentley’s racing heritage.
Q. What are your arguments for claiming: “A Bentley is unmistakable”?
A. If one looks at Bentleys from the very beginning, there are traits which are “unmistakable”: the style, including consistency of design cues and body proportions, the unique combination of performance and comfort, the bespoke nature of so many of the cars, the attention to detail, the
degree of craftsmanship. No other brand has this unique combination of characteristics.
Bentley cars are expensive – their unique characteristics make them so. As a result, our average customer profile is of high net worth individuals who would typically be multi-millionaires, who own a number of cars and may well be chauffeur driven. It is unlikely therefore that any of our staff would be in this position.
Q. Bentley Motors is making a significant contribution of over EUR 1 billion to the UK’s balance of trade. How do you see the company’s role in the country’s economic future development?
A. We are a leading employer in the North West of the UK, employing some 4,000 people, the majority of whom live locally. We seek to be a good corporate citizen of both the region and the UK as a whole participating in a number of local, regional and national activities which seek to benefit the country as a whole. We are committed to our home in Crewe which is symbolic of the company and its history.
Q. Being a giant auto manufacturer globally, what’s Bentley Motors CSR policy like? How much is the average annual budget allocated to this direction?
A. We seek to be a good corporate citizen in how we operate and also in respect to the places in the world in which we operate. We therefore contribute to a range of local and national organisations in different countries. These activities may often involve our retailer network as well as Bentley Motors itself. In the UK for example, we support the Prince’s Trust, and we have a very active apprenticeship programme that has achieved national recognition.
Q. Which organizations are your corporate clients and which brands and models are demanded most in this respect?
A. Our clients tend to be individual purchasers rather than corporate clients and we have only one brand, Bentley.
Q. What do you regard the most significant developments in the market in 2007 and what’s your outlook for 2008?
A. 2007 was a record year for Bentley as we passed the 10,000 sales mark for the first time. For 2008, we expect to consolidate our recent growth which has been substantial considering we were selling only around 1,000 cars five years ago. Regarding the market itself, 2007 could be viewed as the year that environmental issues became mainstream as the Frankfurt Motor Show featured the widest ever array of vehicles with “green” credentials. For this year, our outlook is one of confidence despite the recent economic volatility. ery professional” theft.
Written by Kate Tabatadze
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