But not all is lost.
Earlier this month we reported about the ultimatum given to Bentley by VW Group's main shareholders: turn a profit or else. Turns out the British luxury carmaker has been losing money and these very influential shareholders have given it a two-year deadline to get back in the black. Unfortunately, there's another factor Bentley has to contend with that could hinder that: Brexit.
Reuters reports that Bentley is currently on track to be profitable for this year, but a no-deal Brexit is putting it at "fundamental risk," according to Bentley boss Adrian Hallmark. "It's Brexit that's the killer," he said. "If we ended up with a hard Brexit… that would hit us this year because we do have a potential to get beyond break-even to do the turnaround. It would put at fundamental risk our chance of becoming profitable."
Considering Bentley lost $156 million in the first nine months of last year, a possible hard Brexit really couldn't come at a worse time. And given the British government rejected the deal negotiated by Prime Minister Theresa May and the EU, companies like Bentley are now very worried about what's going to happen in around 60 days' time.
Along with other English carmakers, such as Aston Martin and McLaren, Bentley has been busy making preparations for the day after Brexit by increasing stocks of imported parts from just two to ten days, and even building a higher proportion of vehicles for markets outside of Europe. "We will build more cars for China or the US than we would normally do in the six-month period," Hallmark added.
On the plus side, Hallmark has positioned Bentley to be in the best place possible, all things considered. As of now, he has no plans to temporarily halt production once England leaves the EU on March 29. Honda and Mini, for example, are planning a temporary production stoppage. Bentley, although it's owned by VW Group, is based in Crewe, England. In 2018, its sales declined by five percent because of a delay launching the new Continental GT. For the time being, Bentley has no plans to leave the UK for the EU mainland post-Brexit.