Is the motoring world a better place owing to BMW’s coup d’état that wrenched the Rolls-Royce name off Volkswagen AG?
The latter purchased in 1998 Rolls-Royce Motors (which included Bentley) by outbidding at the eleventh hour the former and disengaging 94 years of British ownership.
VW’s genius but autocratic chairman, Ferdinand Piëch, made the imprudent assumption that under European Union law the licence to continue using the Rolls-Royce name and RR logo for automobile use would be a mere formality. After all, he had pushed through an aquisition that saw an inflated sum of £479 million been paid. Included in the sale was the factory at Crewe, the skilled workforce, access to the worldwide dealer network, ownership of the famous Spirit of Ecstasy and the design of the Rolls-Royce radiator grill.
However, Rolls-Royce Holdings (maker of aircraft engines) who was the brand-name and trademark owner, had a disrupting plan to tackle Piëch’s egomania and was determined he would not get what he desired. Instead, the royalty agreement for the use of vehicles was granted to another company. One that they had a pending aero-engine joint venture business arrangement with, namely Bayerische Motoren Werke. BMW’s counter-attack was a masterstroke in daring. Prior to this, the only trump card they held was that of engine supplier to Rolls-Royce/Bentley, with a 12-month termination clause in their contract. BMW’s board gambled that paying £40 million (with a use-or-lose condition, which was also non-refundable/non-transferable) for the RR insignia and naming rights would bring Volkswagen Group to heel. And it did.
That action, without doubt, was the catalyst that has propelled Rolls-Royce and Bentley on different trajectories. Both German companies, after significant investment, are now building calibre motor cars and have successfully revitalised two British titans.
Under the preceding single ownership by conglomerate Vickers plc (an armaments manufacturer) the allusion that Bentley and
Rolls-Royce were ‘traditional’ was in reality a euphemism for automotive dinosaur.
The BMW and VW upper-echelon managed to resolve their differences over both these English icons, in Germany, over a round of golf. Avoiding a protracted, messy and embarrassing legal battle.