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Bentley has been left hamstrung by the US-UK trade deal that has seen luxury car buyers in America hold off purchases, the boss of the brand has warned.
Unanswered questions about the deal — including how a cap of 100,000 vehicles that the UK can ship at lower tariff levels — have made it “super hard” for the company to run its business, Frank-Steffen Walliser said.
“It means all your customers say ‘I won’t buy a car now’, especially our customers, our clients don’t need a car at the moment,” he told the FT’s Future of the Car summit on Tuesday. “It is super hard on the business at the moment, nobody’s moving.”
He said questions include when the scheme starts and how the cap works, adding that the announcement of lower tariffs without clarity on how they would be implemented was “the worst thing that can happen” when running a business.
The deal struck last week, which has been broadly welcomed by the UK’s car executives, will reduce potential tariffs of 27.5 per cent down to 10 per cent for the first 100,000 cars shipped from the UK. It would have accounted for almost all of the 101,870 vehicles exported to the US last year, according to the Society of Motor Manufacturers and Traders.
“Is the 100,000 for Bentley? I can live with that,” said Walliser. But “I assume our colleagues from JLR would also like to have a chunk”.
According to the text of the trade agreement released on Thursday, the US and UK were set to continue negotiating tariff reductions on “sectors of importance”.
Details of the limited trade deal are yet to be ironed out and the result still leaves Britain facing a tougher trading relationship with America than before Donald Trump introduced sweeping global tariffs last month.
“We are working hard with the government, having direct conversations with the government to find out how it will be operating,” said Walliser, but added that the government also clearly did not yet know how it was going to work.
“Don’t get me wrong, I’m not complaining [about Britain tricking the first trade deal], but it is not operational,” he said.
Although Britain’s car industry is heavily reliant on European exports, about one in six of the cars shipped goes to the US, and it is the largest market for high-end brands such as JLR, Bentley and McLaren.
Walliser said he would monitor moves by competitors before making a decision on whether to raise prices for Bentley cars.
Before the trade deal with the US, Aston Martin had said it would wait until mid to late May to raise vehicles prices, while Ferrari, which exports from Italy, has already announced price increases of up to 10 per cent on some of its vehicles.
