Aston Martin on the rocks, but who will save the company?
The Aston Martin DB5 that was used in the James Bond movie 'Goldfinger' is seen at the opening of the Bond in Motion 50 vehicles in 50 years exhibition at the National Motor Museum in Beailieu, near Southampton, England Sunday, Jan. 15, 2012. (AP / Alastair Grant)
Published Saturday, December 8, 2012 7:00AM EST
Last Updated Saturday, December 8, 2012 7:15AM EST
Want to buy Aston Martin? No, not the car -- the company. This renowned British brand, which goes back to 1914, is once again on the rocks. Even its most famous customer James Bond doesn’t have enough dough to save it. Even Kuwait’s Investment Dar, who together with Adeem Investment bought the brand from Ford five years ago, is unwilling to pony up.
Aston Martin builds some of the most beautiful cars in the world -- but not enough of them. Last year they only built 4,200 Aston Martins. That’s it. Porsche sells well over 100,000 and this year Aston Martin sales have dropped by another 20 per cent.
It is very, very difficult for an independent automaker to survive on 4,000 cars a year even if some of them have a sticker price of a quarter of a million bucks. Porsche is owned by the Volkswagen group; so is Audi and Lamborghini and Bentley and Bugatti. If any of them need new technology they can dip into the Volkswagen parts bin. Not Aston Martin.
Most people think of Aston Martin as James Bond’s car because in 11 films over 50 years Jimmy has driven one. Yes, he started off in a Sunbeam Alpine and he’s had a Toyota and a couple of Bimmers, even an AMC Hornet, but Bond, whoever is playing him, always comes back to Aston Martin. His first DB5 had two machine guns, battering ram bumpers, revolving licence plates and an ejector seat.
At the moment it appears that Aston Martin’s Kuwaiti owners have a couple of fish on the line and are trying to reel one of them in. India’s Mahindra and Mahindra, which is the world’s largest tractor company, has shown some interest, although the connection between tractors and super-sports cars escapes me. Another possible is Italian private equity fund Investindustrial. They owned Ducati Motorcycles for a few years before flipping it recently to Volkswagen Group (yes them) and probably would like to pass Aston Martin on if they could get it cheap and run the price up.
In spite of its financial difficulties Aston Martin has been able to create a lineup of aluminum super cars like the DB9, Vanquish and Vantage. It’s a great brand with a strong British tradition that has been run since 2000 by a German who holds a doctorate in engineering from the University of Stuttgart. Before becoming CEO of Aston Martin, Dr. Ulrich Bez headed Vehicle Research and Development at Porsche.
He has done a tremendous job at Aston Martin but you can’t compete against the best premium automotive brands in the world with empty pockets and without qualified partners. So someone has to step up to save Aston Martin and neither tractor makers nor investment bankers would be my first choice.
I think Aston Martin should be snapped up either by Nissan, Honda or Hyundai. Nissan’s premium brand is Infiniti and it’s hardly setting the world on fire. Honda’s premium brand is Acura and it’s been an embarrassment for years. Hyundai has Genesis and the world says “yawn.” Aston Martin has the cachet and snob appeal to give Infiniti, Acura or Genesis a real lift.
Aston also has a fantastic design studio. The Aston Martin Rapide is, in my opinion, the most beautiful four door car in the world. Imagine the good influence its designers could have on those ugly Acura’s with the chrome cheese grater noses. Infiniti is farther ahead in design but could still use help and Genesis needs to go back to the drawing board.
The Volkswagen Group has demonstrated the formula of sharing technology and achieving economies of scale while maintaining the distinctiveness of its various premium brands. Aston Martin would make a perfect partner for a Japanese or Korean automaker that had the sense to allow Aston to remain Aston.
Aston Martin needs to be saved; somebody qualified has to step up or James Bond may have to go back to his Sunbeam Alpine.