A German Rolls-Royce? Or a British BMW?
BMW announced a deal March 30 to buy super-luxury Rolls-Royce. British critics vow a 'bumpy ride.'
LONDON — In the factory where the world's most luxurious car has been handcrafted for 94 years, cynics in the body shop have taken to calling it the Rolls von Royce.
But the more thoughtful of the 2,600 men and women who produce some 2,000 sumptuous limousines each year see this week's purchase of Rolls-Royce Motor Cars by the German company BMW as a rescue from almost certain oblivion. BMW already owns Britain's Rover Cars, including Land Rover.
The 340 million ($572 million) deal, which is still subject to shareholder approval, is also part of an economic and industrial trend that increasingly ignores political frontiers and makes it hard to argue that, in a global context, it matters where a product is produced or who owns the company that makes it.
Any Rolls-Royce workers resentful that a quintessentially British company is suddenly in German hands perhaps need reminding that these days their own country is no slouch at snapping up attractive overseas enterprises.
What could be more American-sounding than Burger King, which is owned by Diageo, a British company. The "American" Brooks Brothers clothing chain is owned by Britain's Marks and Spencer. And since its collapse in 1995, Barings, Britain's oldest merchant bank, has been owned by ING of the Netherlands.
Prof. Garel Rhys, an auto industry analyst at the Cardiff Business School, says that like many other products, cars are now an international commodity. "These are not national decisions any longer," he says. "BMW took a look at Rolls-Royce, decided it fitted into its global production strategy, and acted accordingly."
As blurred industrial frontiers are becoming more common, the tycoons who help blur them are becoming more sensitive. Rolls-Royce limousines are not going to be stamped with a BMW logo or given Teutonic styling.
Within minutes of announcing the purchase deal, BMW chief Bernd Pischetsrieder said a special effort would be made to preserve and enhance the British character of the vehicles.
Indeed, says Professor Rhys, the distinctive character of Rolls-Royce limousines, with their hand-polished radiator grills topped by the winged Spirit of Ecstasy, is one of the main selling points.
But a look under the hood of the new model Silver Seraph, with prices starting at 150,000 ($250,000), tells a different story. Two years ago BMW began supplying Rolls-Royce with a specially-designed V-12 engine. On the Silver Seraph, gearboxes, electronic equipment, and even the paint already come from BMW factories in Bavaria.
BMW executives say the company plans to invest 1 billion ($1.67 billion) developing two new models, including a "mini-Rolls." They are looking to double the work force and triple sales to 6,000 vehicles a year. Rival automakers Daimler-Benz and Volkwagen are also said to be planning forays into the super-luxury auto market.
Mr. Pischetsrieder's "softly-softly" approach, however, has not stilled the voices of some who cannot stomach the idea of a British motoring legend being owned by a German company. Donald Longmore, member of a group of British businessmen who hoped to bid for the company, said he plans to protest to Vickers, the parent company that owned Rolls-Royce Motor Cars.
"The rape of British industry by BMW is going ahead," he said. "Vickers is in for an extremely bumpy ride."
Vickers chairman Sir Colin Longmore responded, "There is an important distinction between location and ownership. The business will remain in the UK because it is the Britishness that is important."