FRANKFURT - Volkswagen AG plans to base a lower-priced Bentley sedan on a new platform that will be shared with flagship Audi and VW models.
The new Bentley will play a key role in plans to boost annual Rolls-Royce Motors Ltd. production in Britain from 2,000 cars to 10,000.
Vickers PLC shareholders voted this month to sell Rolls-Royce to VW for £430 million, or about $700 million. The deal is scheduled to be completed by Aug. 1.
VW sources say the new Bentley will be introduced in about two years at a price of around $110,000. A Volkswagen executive said new upper-level Audi 'A8-plus' and 'Passat-plus-plus' sedans will use the same platform, but likely will be built in Germany.
VW's multitiered luxury-car strategy also includes plans to revive the historic Horch brand owned by Audi AG. A small series of Horch super-luxury cars will be built by hand at a new factory in Dresden, Germany. VW sources say the Dresden plant will be completed in about 2000. Annual production will be 40 to 50 cars.
Horch cars were produced in Zwickau, Germany, from 1904 until World War II. The company was created by August Horch, who died in 1951. Horch founded Audi in 1910.
Last week, Audi AG agreed to buy Automobili Lamborghini S.p.A., and VW is negotiating to acquire rights to the Bugatti brand name.
Earlier this month, VW announced a deal to develop a luxury sport-utility with Porsche AG.
BMW AG, which lost out in the bidding for Rolls, says it will develop its own super-luxury cars to rival Rolls-Royce and Bentley. BMW also said that it will terminate a 4-year-old contract to deliver engines for the Silver Seraph and Bentley Arnage.
'It will take about one year until the last engine is delivered,' said a BMW spokesman. He said a clause in the 1994 contract allows for termination in case Rolls is sold to a competitor.
'It is not just the engines and the components that we don't want to give to a third party,' he said. 'It's our know-how that we don't want a competitor to have.'
Volkswagen says it will use its own engines.
During a trip to the United Kingdom in April, Piech brought with him a styrofoam model of VW's new W-12 and fit it in the engine bay of a Silver Seraph. VW says it will produce eight- and 12-cylinder engines for Rolls and Bentley at Cosworth, Vickers' engine-making subsidiary in the United Kingdom. VW is offering an additional $200 million to acquire Cosworth.
Meanwhile, VW is negotiating an agreement with Rolls-Royce PLC to acquire rights to the Rolls brand name. Royalty payments will be based on units sold. Rights to the Bentley name came with the acquisition of Rolls-Royce Motors Ltd.