A new generation of wealthy consumers sees nothing déclassé about SUVs. Bentley has been among the last luxury holdouts, and that will end in 2016.

Bentley not backing down from luxury SUV

November 26, 2013: 3:42 PM ET

A new generation of wealthy consumers sees nothing déclassé about SUVs. Bentley has been among the last luxury holdouts, and that will end in 2016.

By Doron Levin

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FORTUNE -- The idea that Bentley, or any ultra-luxury automaker, would manufacture a -- shudder! -- sport-utility vehicle once provoked a condescending chuckle from brand executives.

No longer. Porsche now offers Cayenne. Maserati, Lamborghini, Jaguar, Alfa Romeo all are developing SUVs. Even Rolls-Royce, a subsidiary of BMW, is considering one -- and I'll lay odds it will happen.

A new generation of wealthy consumers sees nothing déclassé about SUVs. Bentley has been among the last holdouts -- and that will end in early 2016, when its SUV comes to market, Kevin Rose, Bentley board member for marketing, confirmed last week in Los Angeles.

Critics panned an earlier version of a Bentley SUV shown at the 2012 Geneva Auto Show. Bentley scrapped its initial design, and the new version is being developed at the company's headquarters in Crewe, England.

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The reasons for building an ultra-luxury SUV are simple: They make money. High-end customers expect to see them in showrooms, will pay the hundreds of thousands they cost, and, in any event, have been buying Range Rovers, Mercedes G-Wagons, and Cadillac Escalades in the interim. In fact, Bentley discovered that 30% of its owners already own a Range Rover.

A Bentley SUV could add to the bottom line since its corporate parent, Volkswagen, already has invested in the architecture and engineering used for the Porsche Cayenne and VW Touareg. Grafting Bentley flesh onto a skeleton borrowed from Cayenne is far less costly than developing from scratch.

Bentley chairman Wolfgang Schreiber hinted to The Sentinel newspaper in Stoke-on-Trent, England earlier this month that a new SUV could include unspecified "green technologies" -- perhaps a hybrid engine.

"For our existing models with their technology platforms," he said, "it wouldn't be possible to create a hybrid without starting again and doing it all from new." At some point, the new SUV could be offered as an electric vehicle, he said.

Before VW bought Bentley in 1998, the automaker was seen as an elegant, though somewhat antiquated, symbol of the British upper crust. Members of the royal family to this day own and travel in Bentleys. The company is very proud of this fact. Indeed, the rear seat of the Mulsanne used by Prince Charles recently was lowered slightly so his consort, Camilla, could easily enter and exit while wearing her hat.

This year, Bentley may reach 10,000 vehicle sales worldwide, consisting of its Continental GT coupe, Flying Spur sedan, and Mulsanne large sedan, which is more or less a limousine. That number constitutes roughly a quarter of the worldwide market for ultra-luxury vehicles and is distributed fairly evenly among China, the U.S., and Europe.

While some automakers brag to shareholders that they can build a car in as few as 30 to 40 labor hours, Bentley boasts the opposite: About 350 hours of craftsmanship are required to build the Flying Spur, and it takes 560 hours to construct the Mulsanne.

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Anyone who doubts those numbers is invited to Crewe in northern England to watch the workers stitch leather, shape the brightwork, and turn the planks into gorgeous wood grained paneling. About 8,000 visitors a year, including many customers, take Bentley up on the offer.

Once upon a time, a Bentley was something to drive because you were a duke or an aristocrat or maybe a CEO. The car was a status symbol. Bentley has tweaked its pitch: You should buy today's models, and the SUV to come, because you've earned it.

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