Lamborghini, Bentley SUVs help exotics rise despite chip, COVID upheaval

Sales of the ultraluxury cars are booming this year in Europe as the likes of Bentley, Ferrari and Lamborghini shook off supply concerns to lift a segment that for many players is becoming more and more profitable.

Sales in the exotic segment rose 11 percent in the first eight months to 10,789, led by the Lamborghini Urus SUV, according to figures from Dataforce.

Growth came despite increased competition from premium players such as Maserati and Land Rover’s Range Rover subbrand that are also chasing business from Europe’s ultrahigh net worth individuals.

That double-digit percentage gain was the third highest of any segment in a year in which sales are down sharply due to manufacturing bottlenecks caused by supply shortages.

It was also the only segment gain not driven by sales of electric vehicles, which have supplied most of the volume increases this year for the two fastest growing car classes among the 21 segments that Automotive News Europe tracks: luxury sedans and premium midsize SUVs.

Exotic segment growth also came despite the run-out of the third-placed Ferrari F8, which is being replaced as the brand’s volume-selling mid-engine supercar by the 296 GTB. The F8 was the segment leader for the same period last year, but sales of the recently launched 296 have yet to catch up.

Ferrari’s supercar switchover has pushed the Urus and second-placed Bentley Bentayga SUVs to the top of the segment (see table, below).

The two remain the only SUVs in the segment’s top 10, with the Aston Martin DBX falling to 13th after sales declined 10 percent from the previous year despite the addition of the new 707 high-performance version.

The Rolls-Royce Cullinan SUV occupies a higher price bracket, but achieved a 93 percent bump to record 315 sales, accounting for a little over half of all the BMW Group brand’s volume in Europe during in the period.

Ferrari, meanwhile, last month unveiled its answer to the sector’s pivot to SUVs, the Purosangue, ahead of deliveries that are scheduled to start next year. Ferrari’s starting price for the V-12 powered model of 390,000 euros ($381,000) is significantly more than the 195,538 euro price of the newest Urus S mid-spec model.

Ferrari, however, still expects to sell its production cap of 3,000 annually, of which around 1,200 will come to this region if the brand’s current 40 percent European sales split continues.

Bentley’s 2016 launch of the Bentayga established the ultraluxury crossover subsector, but the Volkswagen Group subsidiary now has rivals outside its core competitors.

“The last generation Range Rover didn't overlap at all with Bentayga pricing. Now there's 80 percent overlap,” Bentley CEO Adrian Hallmark told Automotive News Europe earlier this year. “If they're successful and people are looking at 150,000 pound (172,300 euro) Range Rovers, they will look at a [similar priced] Bentayga and make a decision.”

Bentley also faces pressure from Mercedes-Benz with its range-topping Maybach versions of the S-Class sedan and GLS SUV. No sales splits were available for those models, but Mercedes indicated during its  investor day in May that it intends to grow its offering in the segment, including a Maybach version of the EQS electric sedan as well as a version of the SL roadster.

“The margins in that segment are nice,” Mercedes Chief Financial Officer Harald Wilhelm said.

Bentley, meanwhile, has increased prices for the Bentayga, which now starts at 165,000 pounds in the UK for either the plug-in hybrid version or the derivative powered by a V-8 gasoline engine.

The plug-in hybrid’s price has increased by 24 percent since its launch in 2019 when it started at 133,100 pounds.

Bentley has also further expanded the Bentayga’s price range with the recent launch of the extended wheelbase model, which the company has indicated will start at about 185,000 pounds.

Bentley has recently ramped up production of the plug-in hybrid Bentayga after a delayed rollout. So far, the variant has accounted for much of the Bentayga’s 49 percent sales increase this year, adding another 364 unit to the total, according to Dataforce.

So far, plug-in hybrid is as electrified as this sector gets, with sales led by the Ferrari SF90 plug-in hybrid supercar over the eight month period.

In a segment where combustion engine noise is highly prized, it’s perhaps no surprise that electric drivetrains have yet to penetrate except for very low-volume hypercars such as the Rimac Nevera.

That will change next year when Maserati launches the Folgore full-electric version of the new GranTurismo coupe and GranCabrio convertible. The new EV will sit side by side with V-6 siblings but will eclipse their performance.

The Folgore’s three electric motors produce continuous usable power of 749 hp and total installed power of more than 1,183 hp, compared with 542 hp for the Trofeo variant of the car.

The GranTurismo is now priced firmly in exotic territory with Maserati indicating prices of 200,000 euros, 50,000 euros above the car it replaced.

Also, due to be launched next year is the Rolls-Royce Spectre electric coupe, which is expected to replace the Wraith coupe.

Aston Martin, meanwhile, will launch its first electric car in 2025, as will Ferrari. Bentley has pushed back deliveries of its first EV until 2026 but will unveil it in 2025.

The year has been good to those ultraluxury and premium companies that belong to or are aligned with larger automotive groups, which were able to funnel scarce microchips toward their high-end subsidiaries to continue to benefit from their vehicles’ outsized margins.
 
Porsche, for example, admitted in its recent share prospectus that the company “has in the past benefitted from preferential semiconductor allocation from the Volkswagen Group, which has reduced the severity of the impact of the global semiconductor shortage” on the sports car maker.

Consequently, all dedicated ultraluxury brands increased year-on-year sales, with the exception of McLaren (down 41 percent in the eight months) and Ferrari, which fell 5.6 percent, but that was more to do with the F8’s production end than specific manufacturing issues.

Bentley reported record-breaking profits, reaching 23 percent margin in the first half of the year as revenue per car rose to 213,000 euros.

Ferrari’s margin for the second quarter reached 25 percent, it said.

Among the ultraluxury automotive companies that release quarterly financial figures only Aston Martin posted a loss in the first half.
 
McLaren’s most recent financial report showed a loss for 2021. Although it hasn’t revealed any figures for 2022, the slow rollout of McLaren’s new Artura core supercar model (with just 10 registered in the first eight months across Europe) suggests the first half of 2022 didn’t bring the troubled company the profits it needs.

The future of the sector mostly looks bright, predicts the bank UBS, even as the rest of the market struggles to maintain the pricing power over the last few months due to an expected combination of oversupply and economic hardship in the coming months.

“EV & premium/luxury cars in general should show the highest demand and pricing resilience,” Patrick Hummel, chief financial analyst at UBS, said in a note.

The sector’s continued diversification into SUVs and now EVs should ensure a smooth transition when the market for combustion-engine sports cars drops away, at least for those with good business models.