Bond’s car maker needs a big brother
Aston Martin Holdings Ltd. is looking for a ‘‘big brother’’ partner in order to survive as a lowvolume, luxury carmaker, even after it posted its first profit in eight years and prepares for a potential initial public offering.
The manufacturer famous for making film spy James Bond’s favourite car could use a combination of capital raised from an IPO and a tie-up with a bigger player to ensure it stays on top of the autonomous driving curve that’s pushing carmakers to invest billions in the technology, according to Chief Executive Officer Andy Palmer.
‘‘We are making a new kind of a company, a company that can survive on 7,000 to 14,000 very highly priced, very profitable cars a year, but it can survive because of its partnerships,’’ Palmer said in an interview with Bloomberg TV.
‘‘It can be very profitable on that 7,000 to 14,000 cars a year but only by having a big brother that can help it out.’’
The company said pretax profit swung to £87 million (NZ$166 million) last year from a loss of £163 million in 2016.
The profit was the first since 2010, according to a spokesman, spurred by sales of its latest sportscar model the DB11.
The results help cement Palmer’s turnaround of the iconic brand, while sales of its newest models will give the company a boost ahead of any sale of shares.
Bloomberg reported last month that the carmaker is eyeing a valuation of as much as £5 billion in an IPO.
Mercedes-Benz owner Daimler AG already owns a 5 per cent stake in Aston Martin and the two companies have a partnership to develop driverless capabilities, Palmer said.
He needs more industrial backing to stay ahead in the technology, he said, without being specific.
Other niche luxury players are already allied with bigger backers. Lamborghini is owned by Volkswagen AG, and Ferrari SpA shares ownership with FiatChrysler Automobiles NV. Li Shufu, who on recently acquired a 9.7 per cent stake in Daimler, owns British sports car maker Lotus through the company he founded, Zhejiang Geely Holding Group Co.
Aston Martin is forecasting another gain in earnings this year, which could raise its projected valuation, as it moves toward the introduction of a new model in the lucrative sport utility vehicle segment as well as a new electric car both due in 2019.
The company is also planning another three new models, including two luxury sedans, designed to revive the Lagonda brand.
Sales in 2017 surged nearly 50 per cent with deliveries rising above 5,000 for the first time since 2008.
Adjusted earnings before interest, taxes, depreciation and amortisation came in 15 per cent ahead of the company’s own forecast at £207 million.
Aston Martin is worried over how it will survive the wave of autonomous cars.