The need to prioritise spending following the Covid-19 pandemic will drive carmakers more quickly towards electrification, according to Bentley CEO Adrian Hallmark.
Talking at today’s SMMT Summit, he said: “We have had to ruthlessly prioritise our spend – we’ve had to pull levers to control costs. Whatever we’ve done has been on the combustion engine. We have delayed or deleted certain derivatives.
“All of our plug-in hybrids and electric vehicles are full steam ahead. We, and the industry, may see this as a natural accelerator to green technologies. If you have to prioritise, where do you place your bets? More horsepower or more cell technology? The obvious answer is the latter.”
Bentley has recently announced it will cut almost a quarter of its workforce as it looks to restructure the entire business under an initiative called Beyond100. The plan is intended to make Bentley “a sector-defining, financially independent and recession-proof business”.
Hallmark said, since joining Bentley at the beginning of 2018, there has been three crises. “The first was internally driven because we weren’t sufficiently prepared for WLTP regulations, the second was preparation for hard Brexit and the third is now Covid-19. The first message is that the crises can be expected – although hopefully not this frequently. The key to success is both flexibility – we have to be innovative and face up to new realities.
“Secondly, cash. In closing down for Covid-19, we predicted three months without any revenue and prepared for that, and we won’t be far off that. We closed down early and restarted early. Within three to four weeks, we should be up to 100% production. Today it’s just 50% of normal capacity.”
He added that Bentley’s monthly costs are £88m. He described the Government’s furlough scheme as “inspired” but said people costs were not the biggest cost driver for Bentley.
Talking about the future after Covid-19, Hallmark said: “We see it as a turning point not as an end point. We can see a bold future beyond this crisis, we believe electrification and make business and drivetrain sustainable is both desirable and possible.
“We’ve fully committed to electrifying our business as fast as we can. We’ve made our factory sustainable, next will be our product range and then our supply chain.”