Rolls-Royce and Bentley Motor Cars Ltd. will develop a mid-sized luxury car aimed at upper range BMW and Mercedes-Benz models - but sold at a premium price.
The move is part of Volkswagen's plans to sell 9,000 Bentleys a year after 2003 following a cash injection of £500 million ($810 million) for model development.
The super-luxury segment - where Bentley and Rolls-Royce now compete - only accounts for 2,000 sales worldwide each year, said Christophe Georges, Rolls-Royce Motor Cars' regional director for continental Europe, based in Lausanne, Switzerland.
'With the new mid-sized model, we will focus on a much larger segment of the market,' he said. 'That segment currently contains cars priced between £70,000-£80,000, with a minimum 4.0-liter V-8 engine and with two or four doors.
'When our new car arrives, it will certainly be positioned higher to meet demand between the £80,000-£150,000 price brackets. There we expect our volume to grow.
'On a global base, this segment accounted for 136,056 cars in 1998, and we expect it to grow by 20 percent over the next few years - mainly in the USA.'
Georges said it was important that Bentley did not price itself directly against cars in the £70,000-£80,000 class. 'There is still room for us between the super-luxury cars and the executive segment,' he said.
The new mid-sized Bentley will not use a shortened Arnage platform, which Georges says is unsuitable for downsizing. He would not comment on reports that the car could be Audi A8-based, although he agreed 'there are some suitable components available within the VW group.'
The segment comprises about a dozen cars, including Ferraris, Aston Martins, upper-range BMW 7 series and Mercedes-Benz S-class models, and Daimler sedans. Of the 84,625 four-door models sold in that segment last year, 51 percent went to the US market, and 16 percent to German customers.
Of the 51,431 two-door models in this segment, 44 percent were sold in the USA, and 20 percent in Germany.