The British luxury automaker receives ultimatum to become profitable within two years.
VW Group's main shareholders, the Piech and Porsche families, clearly aren't happy with Bentley's financial performance within the group. According to Automotive News, the luxury automaker has received an ultimatum from the shareholders to make a profit within the next two years.
"The important thing is for every [VW Group] brand to generate a reasonable contribution margin," Wolfgang Porsche, head of the families, told the Frankfurter Allgemeine Zeitung. "That is not currently the case at Bentley, and we are not satisfied."
"It can only be one to two years," said Hans Michel Piech, another family spokesman, adding that Bentley must complete its turnaround within that period. However, the two VW Group supervisory board members did not say what would happen if Bentley fails to return to profitability. Their comments have come as a surprise, as the families tolerated losses at VW Group's Seat brand for many years.
According to VW Group's latest financial report, Bentley lost 137 million euros (around $157 million) in the first nine months of 2018. Comparatively, the company made a small profit in the same period the year before. As for the factors that caused such a huge loss, a slow ramp-up of the new Continental GT and exchange rate problems after the British pound fell following the UK's vote to leave the EU were blamed.
The rollout of the Continental GT was delayed to get the right calibration for its Porsche gearbox. Bentley also sources many components from continental Europe, which are more expensive when the pound is weak.
Fortunately, the future is looking bright for Bentley. CEO Adrian Hallmark claims the company could post a full-year profit in 2019. This year, Bentley is expected to launch the Continental GTC, the new Flying Spur, and a Bentayga Sport Coupe SUV, which should also boost its profits.