Here's Why Rolls-Royce And Bentley Want To Make Electric Cars

In the world of electric cars, luxury is defined by Tesla, with new competition coming from Cadillac (the ELR) and BMW (the i8). But those cars could soon be eclipsed by top tier offerings from Bentley and Rolls-Royce.

In interviews with Business Insider, executives from both brands said they are seriously considering a plug-in hybrid car. Plug-in hybrid electric vehicles (PHEVs) combine the ability to run on electricity stored in a battery with an internal combustion engine. They usually offer an EV mode range of under 40 miles, with the capability to drive over 200 more miles on traditional gas power.

With high fuel prices and governments (especially in the U.S. and Europe) cracking down on gas-guzzling cars, automakers everywhere are working to crank up their miles per gallon numbers. There are more hybrid, pure battery electric, and diesel vehicles on the market than ever before. They're not good options for the two ultra-luxury players, however.

Diesel offers great fuel economy. It's widely used in the Europe, and growing in popularity in the U.S. But it's not used for passengers cars in China or the Middle East, key regions for both brands. And because each sells so few cars, there's no sense in creating totally different products for each market.

For Chinese customers, "diesel is for trucks, end of story," Bentley Sales and Marketing Director Kevin Rose said. "It would be a brave person who comes along with a luxury diesel car for China." Torsten Müller-ötvös, the CEO of Rolls-Royce, concurred. "It wouldn't make sense to introduce a diesel," he said.

A purely electric car, Müller-ötvös explained, wouldn't work either: Rolls-Royce makes heavy cars; that's part of its luxury feel. Same goes for Bentley. With the current state of battery technology, that means range and power would dramatically reduced. Rolls-Royce did built an electricity-powered Phantom and had customers test it. Many were "ambivalent," worried about slow charging times and limited range. Compounding the problem is that most of its customers live outside city centers, where short drive times make EVs useful.

But a PHEV, which combines the fuel savings and quiet feel of an electric car with the practicality of a gas-powered one, is a workable solution. "For me, the direction of plug-in hybrids is probably more the direction to go with Rolls-Royce motor cars," Müller-ötvös said.

Bentley is headed in the same direction. "Plug-in hybrids could be an especially good technology for us," Rose said. Research shows that customers would be interested, and the key is making it easy to use, "which is what we're working on."

The luxury brand is coming out with an SUV - "the first genuine luxury SUV" - in 2015, and it's a likely candidate for a plug-in hybrid system after its launch, Rose said.