Rolls-Royce Plans SUV Countering Elite $570,000 Mercedes

Rolls-Royce Goes Off Road With New SUV

Rolls-Royce will develop a sport-utility vehicle, countering a push by Mercedes-Benz into ultra-luxury sedans as competition for wealthy consumers intensifies.

Daimler AG’s Mercedes is challenging turf traditionally held by Rolls-Royce with the introduction next year of the 500,000-euro ($570,000) Maybach Pullman. The three-row, extra-big version of the S-Class would beat the $403,000 starting price of the Rolls-Royce Phantom. The BMW AG unit is striking back.

“We are developing an all-new Rolls-Royce with exceptional presence, elegance and purpose,” Peter Schwarzenbauer, the brand’s chairman, and Chief Executive Officer Torsten Mueller-Oetvoes said in a statement. “We will take our time in developing and perfecting this new concept in luxury.”

The elite Mercedes and Rolls-Royce models are the latest efforts by carmakers to target the wealthy. Maserati and Bentley are both expanding with new crossovers, and Audi is adding an electric-powered supercar. The goal is to appeal to the growing ranks of millionaires, which are expected to surge 53 percent to 53 million people in 2019, according to Credit Suisse’s Global Wealth Report 2014. Currently, about 0.7 percent of the world’s adult population owns 44 percent of household wealth.

“Growth in income inequality has been very strong over the past five years, which favors demand for these super cars,” said Stuart Pearson, a London-based analyst with Exane BNP Paribas. “The cars will still be rare enough to not lose their luxury cachet even if there are more models.”

High-Bodied Car

Rolls-Royce was vague about the timing and details of the SUV. It said the new car will have an aluminum frame, be “high-bodied” and be able to “cross any terrain.” That could put it in competition with the Mercedes G-Class, which costs $137,000 for the AMG performance version.

Meanwhile, the Mercedes Pullman promises unprecedented opulence. The 6.5-meter (21-foot) car has space for four passengers to sit facing each other in the rear. The car has about four inches more headroom than the standard S-Class.

A partition window between the driver’s compartment and the passengers can become opaque with the touch of a button, while a retractable 18.5-inch flat screen -- about twice the size of an iPad -- is also part of the standard equipment.

“The price tag for these cars is irrelevant,” said Peter Fuss, a partner at consulting company Ernst & Young’s German unit. “The very low interest rates around the world mean it makes no sense to save the money, so the very wealthy people of this world are happy to spend it.”