The luxury car maker Bentley sells more cars to China than the UK in 2011, as Bond Street traders tell Channel 4 News that Chinese shoppers are “hugely important”.
The luxury car company, which is owned by the German car giant Volkswagen but based at Crewe in Cheshire, sold 7,0003 cars last year. Despite describing the UK market as “extremely challenging over the past months”, sales were up 5 per cent in the UK, with 1,031 cars sold in 2011.
Bentley’s biggest market last year was America, where sales were up 32 per cent last year. But the company’s fastest growing market was China, where export sales nearly doubled to 1,839, making it the second largest buyer of Bentleys worldwide.
Bentley Chairman and Chief Executive Wolfgang Durheimer said: “It has been a tremendously good year for Bentley. The dramatic sales growth reflects a global strength to the brand and a recognition of the quality, craftsmanship and engineering excellent of our cars.”
Bentleys are “hand crafted” and cost up to £220,000, but that is small change for the growing rank of China’s billionaires. Last year that select group grew to 271 – up 82 on last year. The number of millionaires grew by 85,000 to 960,000.
A recent report from the CLSA investment group reported that China will see the largest increase in wealth in the Asia-Pacific region. The author, Amar Gill, said: “The forces for wealth creation are extremely favourable for Asia in the coming years. Economies are growing faster than any other region in the world. Savings ratios are high and appreciation is a big driver of wealth. As Asia gets richer, the surge in wealthy Asian spending power will become a multi-decade theme.”
At the end of last year the tourism group VisitBritain led a tour of retailers to China in December, taking representatives from London’s Westfield shopping centre, Harrods and Selfridges as well as several smaller businesses.
Katie Thomas, spokeswoman for the Bond Street Association, says the Chinese traveller is “hugely important” to the luxury goods shops. She told Channel 4 News that average spend by a Chinese customer in one transaction is about £675 – far exceeding domestic transactions.
“We now have Mandarin speakers in every store in Bond Street,” she says. “It’s a big commitment, because these luxury goods are products you really have to know, the Chinese shoppers want all the details, so it’s a big commitment not just in terms of language but on product training.
We now have Mandarin speakers in every store in Bond Street. Katie Thomas, Bond Street Association
She said the growth in demand from Chinese shoppers has risen recently: “It’s not a sudden thing but it’s building more quickly now. On Bond Street, from January to November last year we saw a 63 per cent increase in our tax-free sales to Chinese customers. That compares to other big increases of 31 per cent to Nigerians and 30 per cent to the Russians.
“The key thing about the Chinese traveller is that the proportion of their holiday spend is greater than any other country, any other visitor. Their trend is shopping.”
Chinese shoppers, she said, buy watches, leather goods, often British but also French designers: “They are massive consumers of French products. They buy a lot of Vuitton, Hermes. Patek Phillipe is the top watch brand. And these shoppers are quite young – 51 per cent of travellers are between 25 and 45.”
Along with the group the New West End Company , the Bond Street Association is campaigining for the relaxing of visa restrictions for Chinese travellers to the UK. Retailers say the 10-page form that visitors have to fill in for a visa is off-putting, particularly when a single visa allows unrestricted travel in the Schengen area of Europe.
Ms Thomas said: “We are campaigning for an easing of visa restrictions because we are losing a lot of business to Paris and other European cities because currently the Chinese traveller has to have a separate vist to come to the UK, which hinders them. We are lobbying hard on that.”