Credit crunch depresses Bentley sales

Net revenue at Volkswagen’s iconic British subsidiary decreased by €15 million (£11.8m) or 4.4% to €338 million (£266m) compared to the first quarter of 2007, primarily due to exchange rate effects. However, operating profit increased by €1 million (£787,000) to €39 million (£31m) compared to the same period in 2007. Global sales declined by 17.8% in the first quarter of 2008, reaching 2,292 units. This, Bentley said, was almost entirely attributable to calendarisation, with the first quarter of 2007 having seen the very successful launch of the Continental GTC which, like most new model introductions, attracted considerable initial sales before settling down to a more consistent sales pace throughout the year. Taking out this seasonal adjustment, the sales pace in 2008 was broadly consistent with 2007. North American sales were down around 22%, in particular on the west coast and in southern regions, which have been affected by the credit crisis and declining property markets. However, strong growth in emerging markets such as China, up 133.3%, and the Middle East, up 10.4%, was having a compensatory effect, the company reported. Sales of the Arnage and Azure models decreased by 15.9% in the first quarter; however, with deliveries of the new limited edition Brooklands beginning, sales are expected to increase in the second quarter. Strong demand continued for the Continental GT Speed resulting in a first quarter sales increase of +20.8% across the Continental GT model line. Stuart McCullough, the company’s board member for sales and marketing, said: “Coming after a milestone year in 2007 when the company surpassed the 10,000 model sales mark for the first time, these results were to be expected. However, when we take into consideration the fast start we achieved in 2007 with the Continental GTC and the nervousness that surrounds the financial markets, then Bentley sales are proving to be very resilient, and our overall pace remains similar to last year. “The most exciting element is undoubtedly the strong growth we are seeing in new markets. Customers are benefiting from an increasing sales network and some exciting new models, most recently the GT Speed and the limited edition Brooklands coupe, which has received a fantastic reception. As a result, we still expect our annual sales performance to be at around the same level as 2007, but also to maintain our profitability despite the challenging exchange rate impacts.”