The $423,000 Phantom convertible is part of Rolls-Royce's push to woo the world's young super-rich, who do the driving themselves
It has an open top, exposed tailpipes, and an iPod cradle in the glove box. The Rolls-Royce Phantom Drophead Coup?, on display at this week's Paris Motor Show, is definitely not your father's Rolls??ven if the sticker price is an eye-popping $423,000.
The Drophead Coup??, a smaller, two-door version of the classic Rolls Phantom??s part of a push by the legendary British carmaker to woo the world's new, younger super-rich. Instead of a silver-haired tycoon in the backseat of a chauffeur-driven car, today's Rolls buyer is more likely to be an entrepreneur who prefers to take the wheel himself, says Rolls-Royce Motor Cars Chief Executive Tom Purves.
Strong demand for the Drophead Coup??, launched in 2007, along with a hardtop version introduced this year, helped boost Rolls-Royce sales by 25% last year and 43% during the first nine months of 2008. The average age of Rolls buyers has dropped from about 65 to "close to 50" over the past five years, the company says. "If you go to places like Beverly Hills or Miami, you will see surprisingly young people in our Drophead Coup??," Purves says. "There is nothing quite like the wind in your hair in an open-top Rolls-Royce."
East of Suez
These newer Rolls models are still packed with luxurious features, from butter-soft leather seats to yacht-style teak decking that conceals the convertible top when it's open. And for Rolls, smaller doesn't mean small: The Drophead Coup?? is almost 19 feet long. Even so, it costs more than the classic Phantom, which sells for $414,000.
Rolls, acquired in 1998 by Germany's BMW (BMWG.DE), also is expanding its dealer network to target new wealth in China, India, and the Middle East. Although North America is still the biggest Rolls-Royce market, accounting for 40% of sales, China is on track to replace Britain this year in the No. 2 spot (BusinessWeek.com, 5/7/08). But since most customers in the Far East prefer to be chauffeur-driven, the best-selling model in China is the traditional Phantom.
Rolls-Royce owners still aren't a very big crowd, with only 1,010 cars sold last year. And while sales have withstood the global economic turmoil of recent months, Purves says he expects growth to level off.
Unscathed by the Turmoil
Sascha Heiden, a Frankfurt-based analyst at research group Global Insight, predicts Rolls will escape the global turmoil relatively unscathed. "Its customers are people who have enormous private wealth," says Heiden. However, he adds, "the financial crisis will dampen its momentum in China."
For now, the company continues to invest in new production capacity. It recently expanded its Goodwood factory in southern England, adding extra space in the paint, trim, and wood shops, and a new production line that will build a $300,000 "baby Rolls" model that is expected to appear in 2010 (BusinessWeek.com, 10/25/07).
Purves, who became CEO this year after 23 years at BMW, is no stranger to the British automaker. A native of Scotland, he started his career at 17 as an apprentice engineer at Rolls. And he's resolutely optimistic. "We've got a very exciting period in front of us," he says.
For a look inside Rolls-Royce, see our slide show.