According to CEO Adrian Hallmark,after a record-breaking year last year, Bentley Motors reported skyrocketing profits in the first quarter due in huge part to car customization.
Bentley reported its best-ever first quarter, with working profits up 27% to 216 million euros, or about $232 million. Even more remarkable, particularly at a time when many car companies are observing profit margins under pressure, according to Bentley, its sales return increased from 20.9% to 24.4% in the first quarter compared to the same time last year.
The reason: rich buyers are spending more to customize their cars with unique paint colors, leather, stitching, and details.
Hallmark said to CNBC, “Customers are choosing one of our 62 paint colors, the 43 leathers we offer and lots of options. So, it’s a total shift in the configuration of the vehicle. And they’re buying the top models, like the Speed version of the Continental GT, rather than base edition.”
Hallmark stated that the average sales price of a Bentley has risen by 40% over the past four years, but only 9% of that growth is because of model price hikes. “The rest is content,” he added, implying upgrades, choices, and customizations.
Record profits are being made by all supercar manufacturers, from Lamborghini, Aston Martin, and McLaren to Rolls-Royce and Ferrari, thanks to the expansion of personalisation. Still flush with money from COVID-19 and keen on purchasing a one-of-a-kind car that separates them from the crowd, today’s rich buyers are ready to spend a hefty amount on special details.
Ferrari stated in its first-quarter earnings call that “higher personalizations whose contribution exceeded our projections” contributed to an increase in its compromised EBITDA of 85 million euros, or about $91.6 million.
Rolls-Royce’s Bespoke department has earned a reputation for honoring unique customer requests, such as matching the paint hue of an old Japanese porcelain or replicating a Hermès design scheme on a client’s private plane.
The Mulliner Edition section of Bentley’s Crewe plant is producing an unprecedented number of one-of-a-kind Bentleys with custom paint colors, metal treatments, and embroidery. Some customers want personalized names or family crests stitched on the seats, while others choose custom interior lighting or carbon-fiber accents.
A rotating display is one of the company’s well-known choices for its Continental model, where a portion of the dashboard flips from a plain carbon face to an infotainment screen. According to the firm, the upgrade has been bought by almost three-quarters of buyers, regardless of the exorbitant price of about $6,000.
“The whole world of luxury is changing,” Hallmark said. “It’s not just cars, it’s fashion, everything. If customers are going to spend that kind of money on something, they’d rather pay a little more for the upgrade or option to have something truly special.”
Aside from improvements and customization, Hallmark stated that increasing rates, falling markets, and recession worries are not causing a reduction in demand.
“The order intake in the U.S., like most of our markets at the moment, is really strong,” he said. Although the cost of used or pre-owned Bentleys is slightly decreasing, Hallmark deemed the change to be positive.
“We can see on the secondary market that residual values, instead of being crazy and above retail like they were, are now normalizing. But the demand is really strong still.”
