Latest news with #VW-owned
Yahoo
10-04-2025
- Automotive
- Yahoo
The American love affair with Ferraris and Rolls-Royces faces some 'very bad news'
Donald Trump's auto tariffs are a hammer blow for luxury European carmakers. Ferrari has already said it will raise prices, and other brands are halting US shipments amid tariff chaos. Analysts told BI that buyers of Rolls-Royces, Bentleys, and other status cars can expect hefty price rises. Donald Trump may be a Rolls-Royce fan — but his tariffs are putting America's love affair with European luxury car ownership under threat. Analysts told BI that boutique European brands face a hammer blow from Trump's 25% tariff on imported vehicles, with the prices of luxury status symbols such as Ferrari, Rolls-Royce, and Aston Martin virtually guaranteed to rise. Trump abruptly paused many of his so-called "reciprocal" tariffs for 90 days on Wednesday, but the tariff on imported vehicles remains in effect. British brand JLR, which makes Jaguar sports cars and Land Rover off-road vehicles, told BI it had paused shipments to the US this month as it takes stock of the tariffs, while VW-owned luxury manufacturer Audi is reportedly holding cars at US ports. Other luxury brands have already signaled that they will raise prices in response to the trade wars. Last month, Ferrari announced it would hike the prices of nearly all its vehicles by as much as 10%, adding tens of thousands of dollars to the cost of many of its supercars. Analysts told BI that all automakers face a period of disruption thanks to the tariffs — but that the confusion will be magnified for specialist European firms like JLR, Aston Martin, and Ferrari, which don't have factories in the US where they can shift production. "It's very bad news. There's no getting around that. They can't absorb all the cost of a 25% tariff, so that will have to be passed on to customers," said Tim Urquhart, principal automotive analyst at S&P Global Mobility. High-end buyers of Bentleys, Rolls-Royces, and Ferraris should expect to take the biggest hit. Urquhart said that brands at the top end of the luxury market had more flexibility to pass on costs to customers due to their already-high sticker prices. "I'm sure the likes of Rolls-Royce and Bentley will probably be passing on a bigger percentage of the tariff onto customers than BMW, Mercedes, and Porsche," he added. Aston Martin did not respond to a request for comment. A spokesperson for Bentley said the company had no plans to pause imports to the US and had not made a "firm decision" on whether to raise prices, while Rolls-Royce said it was still evaluating the tariffs announcement. Other brands at the lower end of the market may face pressure to scale back their vehicle lineups in the US or put more focus on other markets, as the tariffs make it unaffordable to sell vehicles in the US. "I think there is that risk. I think if they can find other markets away from the US, then they may do that," Philip Nothard, strategy and insight director at Cox Automotive, told BI. Last week, Bloomberg reported that Mercedes-Benz was considering withdrawing some of its entry-level vehicles from the US market due to the tariffs. Backing away from the US would be a huge blow. The US is a crucial market for luxury manufacturers, with European cars like BMW, Mercedes, and Rolls-Royce traditionally serving as a status symbol for the rich and powerful — including Trump. In recent years, the US market has become an important source of growth for many European giants, with sales in Europe and China cratering. German luxury carmaker Porsche said on Tuesday that sales in North America rose 37% in Q1, even as they fell 42% and 10% in China and Europe. Building new factories in the US to get around the tariffs is unlikely to provide an easy way out. "If they need to shift their manufacturing to the US to navigate around the tariff, that ain't quick, and it ain't cheap. So whatever the solution is to navigate around the tariffs, it isn't a quick fix," Nothard said. "You can't just suddenly set up production plants and supply chain and labor overnight," he added. The rapidly escalating trade wars make things complicated, even for those manufacturers who already have factories in the US. In a research note sent to clients on Monday, UBS analysts said China's retaliatory 34% tariff on US exports, which was announced last week, would have a major impact on BMW and Mercedes. Both companies export large SUVs built in their US factories to China. Based on 2024 figures, UBS analysts estimated that the Chinese tariffs could cost BMW around $650 million and Mercedes nearly $2 billion. Since UBS published that research, China increased its tariff on US exports to 84%, meaning the blow would likely be even more substantial. Read the original article on Business Insider
Telegraph
19-03-2025
- Automotive
- Telegraph
Drivers may never want to give up combustion engine, says Bentley
Bentley is pressing ahead with plans to go all-electric despite its chief executive admitting that some drivers will never want to give up petrol or diesel cars. Frank-Steffen Walliser conceded that the luxury carmaker's green transition could scare off some customers, especially those who believe:'If it's not a combustion engine, I will not drive it.' He issued the warning after Bentley recently started work on its first electric vehicle production line in Crewe. The company's 85-year-old Pyms Lane plant is set to begin building its first electric model, a battery-powered SUV, next year, with the first deliveries expected in 2027. Mr Walliser, who was appointed last July, reiterated a pledge to roll out a new electric or hybrid model each year for a decade as a prelude to moving to an EV-only line-up by 2035. The chief executive said the company's clientele is split between people happy to have the latest technology and others who are wedded to traditional engines. Bentley is intent on pursuing the former, he said, claiming its aim is to develop an EV that can win over doubters. He said: 'We have a wide variety of customers. They are not driven by the cost per mile. Different things excite different drivers. 'There are, for sure, customers who say, fine, if it's the latest and greatest technology I will take it, whatever it is.' However, he said others will take the view that 'if it's not a combustion engine, I will not drive it'. Mr Walliser said anticipating future sales trends was more important than focusing on holdouts against EVs, stressing that the electric SUV would help to boost sales. He said: 'If we have a great product, a true Bentley, maybe the best Bentley ever, then we will have enough pulling power no matter what the drivetrain.' Bentley scrapped plans to move to an electric-only line-up by 2030 last November, pushing the date for ending hybrid combustion engine sales back five years. Mr Walliser said the British brand, owned by German automotive giant Volkswagen (VW), was 'maybe a little bit too bullish in the beginning'. He said Bentley is monitoring public attitudes to EVs and anticipates that sluggish demand will begin to pick up. He said: 'Our judgment is that, at the moment, we are at the very deep point on the acceptance of electric cars. We assume it will come back.' Bentley ended production of petrol-only cars last year as it retired its W12 engine, with all models now equipped with hybrid engines as part of the transition towards EVs. The chief executive's comments come after VW-owned Audi said it was reconsidering plans to halt new petrol model launches from next year, a day after revealing that it was cutting 7,500 jobs. Another sister company, Porsche, last month announced that it would expand its petrol-car range after concluding that combustion engines would be around for significantly longer than previously thought. Bentley's operating profit fell almost 40pc to €373m (£314m) last year, though the company said it achieved record revenue per car as it focuses on 'value over volume'. Almost three quarters of buyers opted for the bespoke options from the company's Mulliner personalisation division, which typically costs three times more than the baseline price. Earnings were held back by a volatile economic environment, Bentley said, with the Chinese market posting a drop in sales. Mr Walliser also said it is not yet clear whether Bentley, which imports parts from Europe, would be affected by Donald Trump's trade war. The US market, the company's biggest, has seen no reaction so far to the threat of tariffs, he added, with potential buyers conscious that the situation may change and 'staying cool'.
