Luxury Resilience Amid Global Uncertainty
The economic upheaval gripping global markets hasn’t deterred the ultra-wealthy from indulging in Rolls-Royce’s opulent vehicles, with the luxury automaker experiencing a surge in sales.
“We are in excellent shape, and our order book remains exceptionally strong,” said Torsten Müller-Ötvös, CEO of Rolls-Royce. Speaking during a brief visit on July 26 to meet regional customers and attend to business, he noted that the brand’s sales have reached unprecedented levels, with cars priced at seven figures and above performing particularly well.
Rolls-Royce delivered a record-breaking 5,586 cars in 2021, and the momentum continues this year, with sales up 7% in the first half of 2022 compared to the same period last year. The order books are already full well into 2023. “We had an extraordinary first half, even surpassing the previous year,” Müller-Ötvös stated.
This resilience is a stark contrast to the 2007 Global Financial Crisis, which severely impacted luxury sales. Reflecting on those turbulent times, Müller-Ötvös admitted, “Luxury goods are heavily influenced by sentiment and client emotions, making caution essential.” Yet, despite the ongoing war in Ukraine, soaring inflation, and rising interest rates pointing towards a potential recession, Rolls-Royce has defied expectations.
“Unlike in the past, the pandemic has changed the dynamics,” he explained. Wealth accumulated by ultra-high-net-worth individuals during lockdowns, coupled with a newfound appreciation for living in the moment, has spurred spending. “People realised life is short, and that has fuelled the luxury market significantly,” he added.
Interestingly, the brand’s customer base is evolving. The average buyer is now just 43 years old, making Rolls-Royce’s clientele the youngest within the BMW Group, even compared to Mini buyers. “It’s easier today for bright individuals to accumulate wealth early in life,” Müller-Ötvös remarked, highlighting a shift in demographics.
High inflation has also worked in the automaker’s favour. “With rising inflation, many are turning to real assets, and a Rolls-Royce is seen as an investment,” he noted. Unlike other assets currently losing value, the luxury vehicles retain their appeal and significance.
This robust performance underscores Rolls-Royce’s adaptability and the shifting priorities of the world’s affluent, solidifying its place as a symbol of timeless luxury in an uncertain world.
