Problems Of Rolls-Royce

Press, Volume C, Issue 29511, 12 May 1961, Page 11

Problems Of Rolls-Royce

'THE chairman of RollsA Royce (Lord Kindersley) has announced that his company’s production of RollsRoyce and Bentley cars may be seriously affected by the latest British Budget, which proposes to limit the cost of any car charged against income tax to £2OOO. The car division of RollsRoyce produces about 2400 vehicles a year, and about 50 per cent, of these are exported. At least 70 per cent, of Rolls-Royce’s home customers receive some tax relief on their purchases as a result of the cars being

bought in the name of a company. The order book of Rolls-Royce has shrunk dramatically In Just over two weeks since the budget proposals were announced. The cheapest car from Rolls-Royce costs about £6OOO in England, and if the proposal comes into force the purchaser will receive tax relief only on the first £2OOO in the form of depreciation allowance. The remaining £4OOO will have to be paid in full by the company which owns the car.

Rolls-Royce are seriously

alarmed at the consequences of this proposal. Profit margins on large and luxurious cars are never particularly generous, and an undermining of the company’s home market could spell the death knell of its car production. More than 5500 workers are employed by the RollsRoyce car division.

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