Aston Martin Sold to Consortium
The Luxury British Car Manufacturer Says Goodbye to Ford
As corporate profits took a nose dive, Aston Martin was put up for sale. A group of investors have purchased a majority share in the company, worth $925 million
It’s had more relationships than Pamela Anderson, and in the eyes of many, it’s just as desirable. Once again, Aston Martin, the British gran turismo auto manufacturer, undergoes new ownership.
Life with Ford
In the late 1980’s, Ford bought ownership interest in the high-prestige manufacturer, then located in Newport Pagnell, in southeastern England. In 1994, Ford bought it outright, hoping to capitalize on its association with the James Bond movie franchise and its high visibility as a status symbol in Great Britain and in Europe. Ford also hoped that its luster would rub off on its other luxury brands: Jaguar, Volvo, Land Rover and Lincoln. For corporate purposes, it even bundled their upper management together into what was called the PAG [Premier Auto Group] (Lincoln was released in 2002 to operate on its own as marketing planners realized that the target audience for the marque was just too dissimilar.). It also moved the corporate headquarters of Aston Martin north to Gaydon (near Birmingham), the home to the British Heritage Motor Museum Trust.
Ford loses billions
Ford’s corporate profits dove deeply into the red last year; the Associated Press reports a $12.7 billion dollar loss and continued deficits until 2009). So the Detroit manufacturer looked hard at reducing expenses while coming up with enough capital to develop new, more saleable lines of automobiles. While Land Rover continued to grow and remain profitable, it had become increasingly tied to Jaguar; a possible buyer would need to desire both companies in order to complete a sale. No one stepped forward so Ford looked elsewhere for downsizing.
In August, 2006, Ford sent the word that Aston Martin was up for sale. On March 12, 2007, Ford announced that a consortium of enthusiasts and investors had purchased a 92% stake in Aston Martin, whose worth was valued by Ford at $925 million. Ford will retain an 8%, or $77 million, in the firm.
New owners include keen collectors
The new owners include David Richards, the chairman and founder of Prodrive, a British firm that runs Aston Martin race cars in international sports car races and sells its racing technology to auto manufacturers. The Associated Press also reported that Richards had a personal stake as an investor, too. John Sinders, a well known Aston collector and race car backer, and Investment Dar and Adeem Investment Co., two Kuwaiti firms, round out the new ownership group.
Aston Martin has enjoyed substantial sales for a niche manufacturer, selling over 7,000 cars last year – all at over $100,000 apiece. Since former Porsche executive Ulrich Bez took over the helm of Aston Martin in 2000, its product line and quality have improved substantially. When you’re competing in the $125,000 - $300,000 market, you also need to have fresh products to promote interest. The current models are the V8 Vantage, the DB9 coupe, the DB9 Volante [a name associated with special models for decades], and the Vanquish S. Due to safety and emissions issues, not all are available in North America. However, coming this summer to one of 31 dealers near you in the US is the 2008 Aston Martin V8 Vantage Roadster. Autoweek reported that the new convertible will have a 4.3 liter, 380 hp V-8 with a 6-speed transaxle that should do 175 mph. Aston hopes to produce 3,000 cars, with just fewer than 1,000 destined for the US market.
The greatest challenge for the new owners, who must be reflecting upon the problems encountered when John Tower and the Phoenix Group rescued MG-Rover, is whether they will have the deep pockets necessary to fund capital investment in new models.
Read more:
Aston Martin - History and Future
