Aston Martin is in trouble. Having posted a £119m loss in the first three months of 2020 it was then hit by COVID-19 like everyone else. The company is still convinced its fortunes will turn around though, largely owing to the forthcoming DBX SUV; Aston has been shockingly late to jump on the SUV bandwagon and is one of the last high-end carmakers to do so. Lamborghini, Bentley, Porsche and Rolls-Royce have all had SUVs on their books for some time, and in each case they represent the company’s biggest selling model.
Until the DBX arrives, though, Aston Marin needs cash to see it through and so it will raise a total of £260m by taking on loans and issuing shares to the tune of £190m. It will sell around a fifth of the business to do so. The other £60m will be taken on as debt at 12% interest. Ouch.
Around a quarter of the newly released shares will be bought by Aston Martin’s new chairman Lawrence Stroll, a Canadian billionaire whose fortune came from motor racing and investments in clothing brands like Tommy Hilfiger and Ralph Lauren. In January he led a consortium that invested £182m in Aston Martin in return for a 16.7% stake in the company; Stroll’s Racing Point F1 team will be rebranded Aston Martin F1 for the 2021 season.
Stroll has already proved he’s not afraid to make tough decisions to keep Aston afloat. The company has dramatically reduced dealer stock on his watch and it will lower production of its sports cars, choosing to shift focus on the far more profitable SUV segment, – though that will mean cutting at least 500 jobs. Stroll has also overseen the departure of longstanding Aston Chief Executive Andy Palmer, who will be replaced by Mercedes-AMG boss Tobias Moers later this year.
The company is predicting that the DBX, which is available to order now, will account for half its sales before the year is out – it’s basing that prediction on interest in the car already expressed.
The DBX costs from £160,000 and gets power from a Mercedes-AMG sourced 542bhp 4.0-litre V8, giving it a 4.5-second 0-62mph sprint. It’s built on a bespoke chassis (not shared with anything else) but uses methods common to Aston’s sports cars including bonded aluminium body panels. It’s perhaps surprising that Aston has been so sluggish to produce an SUV – back in 2009 it unveiled the doomed Lagonda Concept SUV (below), which at the time seemed ugly, jarring and faintly ridiculous, but in hindsight was arguably way ahead of its time.
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