By on November 9, 2012
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Aston Martin’s Kuwaiti owners are apparently looking to unload their majority stake in the English sports car maker, but proceedings have been slow to due Investment Dar Co.’s desire to recoup their $800 million purchase price.

While Investment Dar denies looking to sell Aston Martin, Bloomberg reports that the company is hurting for cash after failing to make a payment on an Islamic bond. In addition to Mahindra, Toyota is rumored to be exploring the possibility of buying Aston.

Toyota Motor Corp., Asia’s largest carmaker, hired an auditor to conduct a one-week study on buying a stake in Aston Martin, according to a person familiar with the matter. The analysis, which was preliminary and carried out less than two months ago, hasn’t advanced to a full-blown evaluation, the person said. Shino Yamada, a Tokyo-based spokeswoman at Toyota, declined to comment.

Even with Aston Matin’s advances in modular architectures, it’s tough to be an independent auto maker when economies of scale are so crucial when developing a new car profitably. And without a lucrative branding and merchandising operation like Ferrari (not to mention a parent in the form of Fiat), being absorbed by a larger auto maker is all but a given for Aston Martin.

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55 Comments on “Aston Martin Being Shopped Around By Owners...”


  • avatar
    GaryfromJersey

    It’s been pretty clear over the last several years that AM is cash starved. I hope the buyer has deep pockets and an irrational love for British cars.

  • avatar
    Pch101

    “proceedings have been slow to due Investment Dar Co.’s desire to recoup their $800 million purchase price.”

    I don’t see why they don’t contact some of the “best and brightest” who post here. Some of them were apparently able to find value in the GM and Chrysler bankruptcy sales that nobody else could. Surely, they should be able to find that value for Aston Martin, too.

  • avatar
    celebrity208

    Hmmmm, what would make absolutly no sense at all? Oh yeah! GM + Aston Martin in 2013. Together with PSA! Speaking of which… has TTAC or the B&B come to a consensus as to whether GM + PSA might have any merit?

  • avatar
    L'avventura

    Toyota could learn a thing or two from VW; in how to jungle, manage, and grow multiple foreign luxury brands. Something Toyota has never done.

    Toyota may also benefit from Lotus as well if this deal goes through. Sharing resources and platforms between Aston Martin & Lotus would be ideal. Some of that British magic may also rub off on Lexus as well.

    Its also a good deal given the strong yen. In 2007, when Investmet Dar purchased Aston Martin from Ford, $800M would have been around 96 billion yen (or $1.2B in today’s exchange rate). Today, $800M would be just be 63 billion yen. Exchange rate alone would equate to a third of a discount compared to when Aston Martin was last transacted.

    • 0 avatar
      Dynasty

      I think Toyota would be better off hiring a bunch of Aston Martin engineers, designers, and tradesmen to get some of that British magic. Or maybe create some sort of a cultural exchange between the two companies. Or partner with them like they have Tesla. If Toyota is hell bent on buying AM, they should just buy a few individual vehicles to get it out their system.

      A little salt is good in your soup, but pouring the whole bottle in will ruin it.

      All that being said, a hand built Lexus (in Japan with a team of Japanese and imported English labor), Aston Martin body work, a gorgeous interior, and Japanese electrical components would be a very awesome car.

      I guess just buying a stake in AM wouldn’t be the end of the world, but total ownership would be a very bad financial move for Toyota.

      • 0 avatar
        Andy D

        All that being said, a hand built Lexus (in Japan with a team of Japanese and imported English labor), Aston Martin body work, a gorgeous interior, and Japanese electrical components would be a very awesome c
        Dynasty, That would be some automobile. I am very much besmitten with classic English styling. In their electrics, not so much.

      • 0 avatar
        L'avventura

        Aston Martin customers aren’t really Lexus customers. The reality is that Toyota already has top-notch engineers and designered stationed around the world, that hand-built Lexus you speak of is pretty much the LFA. What Toyota lacks is experience at the highest echelons of the luxury and sports branding.

        Let’s keep in mind, Aston Martin would be the biggest beneficiary of any tie-up with a large brand. They can forgo any silliness like the Cygnet and they can get some much needed technology & refinement.

        This is something Aston Martin is in dire need of as this brutally honest review illustrates:
        http://www.youtube.com/watch?v=mi0yXeuqBjU

        Getting access to that carbon-fiber loom that in in the LFA would be a great winner for AM not to mention engines and hybrid technology. Moreover, sharing the Vantage with the rumoured production version of the LF-LC, would achieve economies of scale.

        But for Toyota its a bad return-on-investment. AM is a money sink-hole, its not a profitable business. It’ll lose money for the foreseeable future and sap cash from Toyota. Toyota would need to think have VW-like vision and wherewithal for an Aston Martin purchase. They would need to build the brand like a Porsche-rival and not like a Ferrari-rival (meaning SUVs, 4-door sedans, etc.).

        The best match would be Tata as Jaguar/LR is located right next-door, Mahindra & Mahindra is likely not good of match, it too lacks economies of scale offered by a large manufacturer.

    • 0 avatar
      imag

      I wish that would happen. I doubt it will, but it’s a nice dream.

      Anyway, for all those saying Aston is worthless, remember that Jaguar looked much worse just a few years ago.

  • avatar
    twotone

    Has AM had a profitable year in the last ten? I’d pay no more than 5X income (not revenue) less debt.

    • 0 avatar
      Pch101

      You can’t really value a company like this on a net income basis, since there is almost no income. The value would be derived from future profit potential.

      Car companies tend to have low margins even in the best of times. That alone should depress the value, since there isn’t much upside here.

  • avatar
    gslippy

    Where’s the obligatory suggestion that ‘the Chinese’ buy Aston Martin?

    [Hint: Just because they have money, doesn\'t mean they\'re stupid with it.]

  • avatar
    racer-esq.

    Apparently it really pissed off the owners that the new Fusion looks like one.

  • avatar
    racer-esq.

    Aston Martin’s managers are literally losing their heads over their inability to make payment on the Islamic bond.

    • 0 avatar
      twotone

      Isn’t charging interest against Islamic law? Sounds like pretty cheap money to me.

      • 0 avatar
        ranwhenparked

        As I understand it, under Islamic law, money isn’t regarded as an asset, just as a means of exchange to acquire assets. It’s forbidden to earn money from money, but OK to profit from an asset. Consequently, Islamic “bonds” actually function more like nonvoting shares of stock. Basically, the bond entitles the holder to a fixed share of the company’s profits, so it’s really more like a dividend than intrest.

        There’s got to be someone out there that understands this better though.

      • 0 avatar
        Pch101

        Under Islamic law, all interest is considered usury and therefore forbidden.

        As I understand it, an Islamic bank will take title to the asset, and the new “owner” will pay the price in installments until the purchase price is satisfied. Of course, the return that the lender would have otherwise made on interest is built into that purchase agreement, but that profit isn’t technically an interest payment.

      • 0 avatar
        corntrollio

        There is a whole area of law around making compliant bonds. The bonds are known as sukuk. There are a variety of methods to substitute for a fact that there is no interest, although there is some controversy over whether certain methods are compliant.

    • 0 avatar
      naterator

      LOL!!!!!! Awesome

  • avatar
    racer-esq.

    There are a lot of cute ways to get around that with fees and mandatory, preferred dividends that are not called “interest”, it is not at all necessarily cheap money.

  • avatar
    LordDetroitofLondon

    Tata motors perhaps? After all AM is on the same engg./ production site as JLR in Gaydon..

    • 0 avatar

      I am thinking that this is the most likely choice, though it’s definitely not the best one for Aston — TTM seems to be having trouble coming up with the money to do proper development at Jaguar. The best choice *for Aston* would be a firm that can help them develop a kickass state-of-the-art new engine to replace the Double Duratech (lovely as it is, it’s getting on in years): Toyota would probably do just fine. As would, say, BMW or Daimler, and I know Daimler took a look once before.

  • avatar
    Darkhorse

    I remember the DB5 in “Goldfinger” in 1966. They made money then, why not now? What happens to these hallowed marques over time? Are they mismanaged or victims of poor execution? I guess incompetence can wreck any company, even Apple.

    • 0 avatar
      Steve65

      They DIDN’T make money then. The company was propped up by David Brown. There’s a famous (probably apocryphal) story about a friend asking Sir David if he could buy an Aston at cost. The reply: “well sure, but why would you want to pay £1000 extra?”

      • 0 avatar
        krhodes1

        And note that back then the cars only cost £4-5000. Tiny exotic car companies are a labor of love, not a profit making operation usually. Morgan seems to be an exception, but it has not exactly made the Morgan family into the English version of the Fords.

        Too bad Bill Gates isn’t more of a car geek than he is – he could buy it with pocket change.

      • 0 avatar
        blowfish

        AM was struggling all the time, not sure during DB’s . But for sure post DB.

        Merc perhaps should have bought AM instead sank mulla into Maybach.

        Ve never know AM or Lotus could end up with its new owner in Middle Kingdom.
        On the subject of bonds since MK holds so much of Uncle Sam’s IOU, they mind as well trade them for something substantial than holding onto a ice cube, u get the good shrinking priceless feeling and seeing her getting smaller by the minute!

      • 0 avatar
        Robert.Walter

        “Too bad Bill Gates isn’t more of a car geek than he is – he could buy it with pocket change.”

        Buying cool things is more Paul Allen’s bag…

      • 0 avatar
        Robert Gordon

        “Too bad Bill Gates isn’t more of a car geek than he is – he could buy it with pocket change.”

        Shame on Bill Gates for spending his money on worthless activities such as Malaria and HIV eradication when he could be propping up a hyper elite niche car maker.

      • 0 avatar
        krhodes1

        Bill has more than enough money to do both. :-)

      • 0 avatar
        28-Cars-Later

        “Bill has more than enough money to do both. :-)”

        and do a preemptive GM bailout…

  • avatar
    rickyc

    I think VW might be the only one that has the cash and business sense to turn AM around. They can share some platforms with Bentley and use some engines from Audi. Aston Martin cars are great but they currently lack modern tech like DI and turbocharging in the engine bay. Toyota would be an ok parent but VW would simply rock it!! They already have proven the ability to do this with Lamborghini.

    • 0 avatar
      imag

      There is nothing to be excited about there. It would put Aston one the same platform as the next Continental and the Panamera. How could it really be differentiated from those?

      At least Mercedes, BMW, or Toyota would allow it to be different.

      In any case, I am sure that VW is well aware that it doesn’t need Bentley, Porsche, and Aston.

    • 0 avatar

      You must be a young guy to think that turbocharging is “modern tech”.

      In any event, Aston won’t use turbos. It’s not consistent with the brand. Supercharging or NA.

      imag’s points about VW being an exceptionally poor fit for Aston are spot on.

      • 0 avatar
        rickyc

        Ever heard of CAFE standards?? All manufacturers are trying to make they cars more efficient even the ones who said they would never consider turbocharging. I know turbocharging is nothing new but today’s turbo engines are just on a different level from the ones in the past. With additional stuff like DI and computer controlled waste gates it would be ignorant to say today’s turbo engines aren’t “modern tech”.

  • avatar
    el scotto

    Can Ford afford to buy out Investment Dar’s shares? The still have some skin in the game.

    • 0 avatar
      ranwhenparked

      That would go against Mulally’s single-brand preference, he only grudgingly tolerates keeping Lincoln around. Ford could still do it if Bill Ford put his foot down and forced it, but I don’t think he wants the headache of owning a perennially money losing boutique sports car brand again. Ford has only really just gotten their house back in order, no sense in slipping back into bad old habits again.

      Would be interesting if Toyota buys, as I think this would be the first time ever that a Japanese company had acquired an automaker outside of Japan, they usually either grow organically or just take over smaller, weaker, domestic competitors.

      The closest any of them has gotten to an overseas takeover was Honda, when they bought 20% of Rover in the late ’80s. BAE tried to sell them the whole thing in the ’90s, but they refused to go any higher than 40%, which lead to the sale to BMW.

      • 0 avatar

        Ford won’t buy back Aston. It’s too bad, because all things considered Ford did a very good job with Aston last time around, but that’s how it’s going at Ford nowadays. They kept Lincoln for a good reason, but they don’t need or want Aston.

        If Toyota buys Aston it’ll be because Akio Toyoda (who is a bigtime car guy) wants it.

        Whoever takes it, I hope they replace Ulrich Bez with somebody who really gets Aston Martin.

      • 0 avatar
        Robert.Walter

        Bez has equity in AML.

    • 0 avatar
      jeoff

      Ford could buy AM back with the intention of eventually killing (rebranding) of Lincoln. Luxed up fords would sell better as Astons–just keep the “real” Astons as halo cars.

    • 0 avatar
      28-Cars-Later

      Ford looked to be divesting from Europe, not sure it would play well with the board to say “Well we closed three plants and see little growth on the horizon in Europe, but then a shiny new toy became available in the UK and we had to have it”

      Now purchasing Aston and moving it lock stock and barrel to North America, this I could see.

  • avatar
    Advo

    They must recognize that the body style is getting boring.

    Ferrari changes it’s models or upgrades styling so often I don’t bother keeping track. I don’t even know if Aston has anything in the pipeline that could plausibly sell and is somewhat different in styling to be new and appealing.

    • 0 avatar
      imag

      I have to disagree. Aston has two of the most beautiful front engine designs of the last 30 years. If Porsche can milk the 911 body style as long as it has, Aston should feel free to keep at it.

      Ferrari’s design team seems to have decided that their cars should look as though they are in the midst of hoovering up enormous quantities of methamphetamine. I am happy to see Aston avoid plastering their cars with deranged cartoon faces in an effort to be “new”.

  • avatar
    kkt

    Aston Martin has lost money almost every year for the last 50 years. It needs an owner that doesn’t mind losing money on it because he’s a fan.

    Disagree about the styling… when your cars look like Aston Martins, they don’t need a styling update. Ferrari is hurt by styling that’s trendy instead of timeless, in my opinion.

  • avatar
    Tstag

    Tata are a good bet but so are BMW

  • avatar
    blowfish

    Honda should have up the stake with her Engrish patient.
    They could have bought the whole package and sliced the LR off to bimmer, since H has no interests in building 4wd.
    Read somewhere when BMW had Rover they treated the Rover’s exec pretty condescending too.

    The closest any of them has gotten to an overseas takeover was Honda, when they bought 20% of Rover in the late ’80s. BAE tried to sell them the whole thing in the ’90s, but they refused to go any higher than 40%, which lead to the sale to BMW.

  • avatar
    Chocolatedeath

    Cant believe no one has mentioned Nissan.. The could use one of the platforms to make a high-line Infinti.

  • avatar
    thornmark

    Quality is job none. Ford is not doing very well and taking on AM wouldn’t help. Ranked 27th out of 28 brands.

    It appears that Ford is doing to double clutch transmissions what it did to CVTs.
    http://blogs.wsj.com/drivers-seat/2012/10/29/consumer-reports-study-details-fords-technology-backfires/

  • avatar

    Hyundai shall buy it.

  • avatar
    genuineleather

    I can see BMW buying it as a sporty complement to Rolls; they could use the same engines, suppliers, even factories.

    Then again, they’ve already bought and dumped Land Rover, so they probably aren’t interested in another British luxury brand.


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