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The Effects Of Brexit Are Already Hurting Bentley

Everything from Bentley factories to a platform partnership with Porsche hangs in the balance.

Topping the list of quintessentially British things right next to English Breakfast tea, mutated bulldogs, and dry senses of humor are Bentleys, the car the Queen herself uses as her main state vehicle. Except that Bentley isn’t British, at least not fully so since was bought by the Volkswagen Auto Group in the late ‘90s. Though the luxury liners are still built in Crewe, England, its German parent supplies many of the parts necessary to construct them. As Reuters reports, that may pose a major issue.

Until recently, Bentley parts made at Volkswagen factories within the European Union and later shipped to Crewe for installation weren’t taxed and flowed between borders freely given the EU’s trade deals. Now that Brexit has passed, the UK and EU are in talks to figure out how such networks of goods will be affected, and if these matters aren’t hashed out in an effective manner, the in-out referendum could stand to seriously affect Bentleys built after 2017. For now, the British government is keeping its lips sealed, claiming that revealing the details of conversations it’s had between itself and the luxury automaker should remain confidential so that it can get a good deal with the European Union.

The British government stated, "Part of the negotiation and exit process requires the UK to be able to effectively pursue and protect our interests abroad. Prematurely publicizing information will prejudice our ability to successfully conduct that business.” The danger to Bentley would manifest in the form of taxes levied on these imported parts, which would add cost and could slow the free flow of parts between EU and UK borders enough to make the automaker’s plants inviable. This poses a particularly large issue given that Bentley and Porsche have committed to sharing platforms and technology in efforts to reduce costs for Volkswagen post Dieselgate, but imposing taxes on these incoming parts could hurt that plan.

Bentley head Wolfgang Duerheimer previously told Reuters that the company would ask the UK government for a guarantee to waive or compensate automakers for tax barriers that would hurt UK jobs and production, though no outside sources, us included, will know for sure until the government opens up about the talks.

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