Rolls-Royce Expands Factory To Craft More ‘Bespoke’ Cars

Rolls-Royce is making substantial expansions to its Chichester factory in England to focus its efforts on more expensive cars. The BMW subsidiary plans to build five new structures, with construction set to start next year.

Typically, carmakers expand factories to speed up output, but Rolls-Royce operates with a different strategy. The luxury automaker believes that increasing production to sell more cars would diminish the brand’s exclusivity.

Hence, this factory expansion isn’t aimed at boosting car production but rather at crafting more high-end vehicles. This intricate process demands extra time and requires additional workshop space and storage for rare materials.

The emphasis on this area highlights the expanding customer base of affluent buyers. While this clientele may have a cap on the number of cars they purchase, they have the means to spend substantially more on each vehicle.

Rolls-Royce experienced a 17% increase in sales since 2020, achieving a record of 6,032 cars and SUVs sold globally last year. During the same time period, the average price customers paid for their vehicles shot up by 43%, from $350,000 in 2020 to an average of $500,000 each last year.

That rise in revenue for each vehicle predominantly stems from more elaborate and time-intensive customization. Rolls-Royce calls these cars “bespoke,” emphasizing luxury customization programs under the names “Bespoke” and, for entirely customized models, “Coachbuild.”

Martin Fritsches, president of Rolls-Royce Motor Cars Americas, said, “We’re not necessarily growing that much in volume. That’s obviously not our focus point. But clearly, our bespoke area is gaining and relevant. And has been expanding dramatically, particularly in the last couple of years.”

The expansion of this factory will mark the company’s biggest since it was built in 2003 after BMW purchased the brand in 1998. Prior to that, Rolls-Royce cars were made alongside Bentleys at a factory in Crewe, UK — Rolls-Royce acquired Bentley in 1931.

Under Volkswagen’s ownership, Bentley continues to produce cars in Crewe and provides its unique customization program. Last year, almost 75% of Bentley customers sought custom options beyond the brand’s comprehensive list, reflecting a 43% rise from the previous year.

Italian supercar makers Lamborghini and Ferrari have also recorded a rise in interest in their customization programs.

In a recent interview with CNN, Lamborghini CEO Stephan Winkelmann said, “We are limited in terms of (market) size and in terms of [market] segments. So we have to get the most out of every single car.”

This heightened demand for customized vehicles is largely due to the rising levels of extreme wealth worldwide. With a rising number of ultra-rich individuals with strong spending power, there’s a growing demand for extravagant features such as diamond dust-infused paint and integrated picnic gear in the cargo area of cars.

Javier Gonzalez Lastra, investment partner with Tema ETFs, which operates a luxury goods investment fund, said, “The customer is rich, but he’s not stupid. You have to earn your price increase.”