Without the backing of an automotive giant, Aston Martin has been soldiering on relatively well over the past few years when one considers its moddest production volumes and the increasingly tough economic climate.
According to Bloomberg, Investment Dar, who own 64 percent of Aston Martin, has approached several companies about the sale of the Aston Martin, including Toyota and India’s Mahindra & Mahindra. Investment Dar is looking to sell it’s share of Aston for the same US$800-million which it paid for the luxury car maker five years ago, but is not finding it easy.
Toyota, which supplies Aston Martin with the architecture for its Cygnet model, went as far as hiring an auditor to conduct a one-week study on purchasing the brand, but the sale has not progressed beyond that point. Mahindra & Mahindra has also held talks with Investment Dar about purchasing Aston Martin, from which there’s been no further action.
Both Toyota and Mahindra have denied any interest in Aston Martin and Investment Dar has likewise denied rumours of the brand being for sale. Despite this, the Kuwaiti investment firm must certainly be feeling the pinch, as Aston Martin has racked up roughly KWD1.37 billion, (R42 billion at the current exchange rate), via an Islamic bond.
Depending on how long this debt can be funded, the prospects for Investment Dar don’t look too rosey. Faced with a load of debt and no new product on the horizon, any new owner would need to plough serious money into R&D to revitalise Aston’s ageing product portfolio. Aston Martin generated US$800-million in revenue last year, which pales in comparison to the US$1.3-billion that BMW spent on engine development alone in 2011.
Speculation would suggest that Tata Motors, who currently own Jaguar Land Rover, or Volkswagen could be willing to snap up the Aston brand. Despite having the buying power though, VW recently announced they are bringing a halt to their acquisitions and have now entered a consolidation phase. BMW already owns Rolls-Royce, but Mercedes-Benz has just dropped Maybach. We’ll leave your mind to race through the endless possibilities.
When it’s all said and done, however, it’s plain to see that Aston Martin cannot continue with its current strategy of reworking existing to platforms and technology. Competitors like the Nissan GT-R and Porsche 911 are far cheaper and technically more advanced. In an interview back in July 2011, Ian Callum, designer of the DB9 and now design director at Jaguar Land Rover said, “It’s still that same old basic design. Some will argue that if it ain’t broke, don’t fix it, but you do get to a time when you have to move on.”
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