Rolls is Rolling

Rolls Royce has always been low volume, high profit, high quality. Recently they have been making power moves across the globe. Efforts that have most likely been led by their owners BMW. Because of the extremely low volume of the company, which is about 3.5k cars a year (Tesla sold almost double that in the last quarter), they must market their automobiles to the few people in each country that would buy them.

With the recent growth of the Gulf States, luxury car brands have found homes in places like the U.A.E., Qatar, and Kuwait. Rolls Royce alone had a 17% increase in sales in those places alone.

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Because of the fact that a growing part of their sales is present over there they hired Brett Soso from a Chinese OEM (Chery Automotive). He has a lot of experience with foreign automotive strategy. His position is, Regional Director of the Middle East, Africa, and South America. Moving to Dubai, he will be able to help immensely in the new market which is expected to grow faster than any other market in the world. This will also increase profits for BMW. It will be interesting to see if BMW decides to expand big into the Middle East. My guess is that as the economies grow there, their upper middle class will grow, which would be perfect for BMW.

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5 comments to Rolls is Rolling

  • mayolj16

    Even if the market in these countries seems to be flourishing, would this last forever or is this just a bubble? I just read this article that shows abandoned luxury cars in Dubai after the crisis, from people who escaped the country after not being able to pay for loans. http://welldonestuff.com/abandoned-luxury-cars/

  • Kade Kenlon

    Is there really a reason to even attempt to expand? There is a fixed amount of people who can afford these vehicles and once they reach that threshold the cars will go unsold. If they truly wanted to expand, they would have to look into decreasing the price for their product. However, this could hurt their image and possibly turn out fewer profits.

  • Zachary Durkin

    I really do appreciate the Rolls. It’s an extremely well built car. However, they’re durable goods, and their consumers aren’t going to be driving them on daily errands or anything. A growth like what we’ve seen in the U.A.E. always tops off. I think the main enemy to Rolls Royce is going to eventually be Rolls Royce.

  • Louis Ike

    We have all seen on tv or heard in the news about the incredible wealth and luxury that exists in the oil rich nations of the middle east. Most of this wealth is highly concentrated, thus offering the landed elite an exorbitant amount of luxury and Rolls is looking to take advantage of that. However, as some have already commented, the market seems to be mostly saturated not to mention that the wealth seen in some of these lands affords its elite the opportunity to ship in Rolls from elsewhere (as I assume many have already done). I wonder if the movement of Rolls into this area is more of an attempt to gain a foothold in these regions for future market penetration by BMW.

  • Jier Qiu

    I agree with Kade. No matter how developed countries are, there are always a proportion of people that can afford these extremely expensive cars. Once these “extra” demands are met, is it going to cut down the production? What about the excess inventory?