Rolls-Royce expanding in United States

Rolls-Royce Motor Cars is adding dealers in the United States as the economy recovers and demand for ultra-luxury vehicles returns, the company's chief executive told Reuters in an interview on June 01. Rolls-Royce ultimately expects to have 38 US dealers and is considering several new locations, including one in the San Francisco Bay Area, CEO Torsten Muller-Otvos said.
The company has 32 US dealers and has said previously it would add four in 2011. Muller-Otvos did not say when Rolls-Royce planned to add the rest.
Demand for Rolls-Royce's distinctive cars with large grilles, squared fronts and decorative hood ornaments depends in large part on consumer sentiment, Muller-Otvos said. "To buy a luxury car is something where you reward yourself for certain, let's say, 'achievements' in life," he said. "It's very much consumer sentiment based."
Founded over a lunch at the Midland Hotel in Manchester in 1904, Rolls-Royce has become one of the world's top luxury brands. Part of its marketing includes positioning it as the car of choice for diplomats.
As Rolls-Royce seeks to serve high-end customers, it is expanding in China, which is the world's largest auto market. It is still on track to increase its dealer base in China to 11 this year from eight currently, Muller-Otvos said.
Though the company is not designing a car specially for the China market, certain elements of its design have been well received, he said.
"We have introduced with the Phantom a so-called extended wheelbase," Muller-Otvos said. "An extended wheelbase gives you even more space and room sitting in the back to relax - which is what Rolls-Royce is about - and that has proven to be very successful in the Asian markets."
Muller-Otvos declined to say whether he expects sales in China to overtake US sales or when that might happen.
Even as money for luxury purchases returns, however, the market may have changed as gasoline prices have risen and federal fuel economy standards are becoming more stringent.
While the ultra-wealthy may not be as price-sensitive, they may have cultural reasons for shifting to smaller or electric-powered vehicles. Rolls-Royce's parent company BMW AG, Volvo and Toyota are all introducing smaller luxury and premium cars, and many automakers are exploring electric or hybrid vehicles.
Muller-Otvos said Rolls-Royce will take a pass on shrinking its cars - he said space is a defining characteristic of the brand - but it is testing an all-electric Phantom.
While questions remain about range and recharge time as well as infrastructure for electric vehicles, Rolls-Royce needs to look at alternative drive trains, Muller-Otvos said. A test model of the electric Phantom is on a global tour which ends in April 2012, and a decision about whether to mass produce it will be made after that. Asked whether Rolls-Royce might consider a hybrid, Muller-Otvos said he wouldn't rule out any possibilities.