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Toward the end of each calendar year, Ian Robertson puts his small arsenal of expensive fountain pens into overdrive. That's when Rolls-Royce motor cars sends an annual yearbook to customers who have purchased a Rolls since Jan. 1, 2003, when production began under the ownership of German automaker BMW. As head of Rolls-Royce, Robertson personally signs each of the book's accompanying cover letters. The bespoke touch is appreciated by the company's superrich clientele — which numbered 2,800 when Robertson performed the task last year. "With that many customers," he says, "I could just about do it."

This year, Robertson may need to acquire an autopen. The iconic British car company is expecting already rising sales to soar. Well, relatively speaking. This is, after all, a company whose ambition is to sell a mere 1,000 cars a year. That's a goal now in reach, thanks to upcoming expansions of the Rolls product line, increasing numbers of extremely rich potential buyers, and fast-growing Asian markets.

Last year Rolls-Royce sold 805 Phantoms, its main model, a slight increase over the 796 sold the year before. Revenues were also up — the company won't say by how much — largely because of the newly introduced, extended-wheelbase Phantom that has a base price of $403,000, or $63,000 more than the standard version. Garel Rhys, emeritus professor of automotive economics at Cardiff Business School, applauds the company's performance since its acquisition by BMW: "You couldn't expect much better." And the company's future looks shinier than a well-buffed fender. In July, it rolled out the Drophead Coupe, a two-door convertible Phantom with a starting price of $407,000. Overall, Robertson predicts, the company should enjoy double-digit sales growth this year.

The firm began life in 1904, when Charles Rolls, an aristocratic automobile aficionado and dealership owner, joined forces with fledgling carmaker Henry Royce. Then and now, the company's cars were big, powerful, stately and silent. In 1931, Rolls bought out more sporty rival Bentley, and for decades the cars were stablemates, eventually becoming fairly indistinguishable from one another, though Bentleys were always slightly less expensive.

When Rolls — which also manufactured aircraft engines — went into receivership in 1971, the auto and aerospace units became separate companies. After a variety of owners, BMW took over and now builds the cars at a plant in Sussex. A low-rise, energy-efficient facility, it currently operates one line and one shift that turn out four to five handbuilt cars a day. The 550 employees include craftsmen — skilled cabinet and saddle makers, for example. Most Rolls sold are bespoke; on average customers pay an extra $20,000 to have a car customized. The company is adding a second line next year and a second shift in 2009 to handle (at the same careful pace) both the Drophead and other planned new cars.

For its first Rolls-Royce, BMW opted to resurrect the Phantom — a big saloon limousine that all but begs to be chauffeur-driven. That means targeting the very rich, whose legions around the world are growing fast. Rolls-Royce now wants to increase its market share while still remaining at the price pinnacle. It's introducing in 2008 a hardtop coupe version of the Phantom and launching a smaller, as-yet-unnamed saloon.

So who is willing to pay a small ransom to own a Roller? They're people who tend to own four to eight cars, and often have at least one Rolls in the garage already — 37% are repeat buyers. Buyers tend to be entrepreneurs, showbusiness celebrities or sports stars; few are corporate executives. One factor working against Rolls-Royce in the West is a growing tendency among the wealthy to be less ostentatious, Rhys says. But showing off one's megabucks is culturally acceptable in China, he adds. That helps explain why China is now Rolls' third largest and fastest-growing market, accounting for 10% of sales. (The U.S. still accounts for 45%.) It was a Beijing property developer who last year paid a record $2.3 million for a superstretch Phantom.

Notwithstanding the richness associated with Rolls-Royce and the costs involved in making each one, the unit is not a big expense for BMW, which has annual sales of $65 billion. BMW won't say how much it's invested in the company since 1998, though Rhys conservatively estimates it could be around $1.2 billion. BMW will certainly be happy to see Rolls generating profits, but they won't much affect the bottom line. But owning Rolls-Royce gives BMW some intangible benefits: prestige and bragging rights. It proves it can sell cars that sweep the breadth of the market, from budget to budget-busting. To be sure, if the world's economy sputters and all car sales go off a cliff, and if BMW's profits were to take a major hit, "Rolls-Royce would probably be the first thing to go," Rhys says. But for now, like that iconic spirit of ecstasy that makes up its hood ornament, Rolls-Royce looks poised to speed ahead.

• THOMAS K. GROSE/WESTHAMPNETT
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