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Bond, junk bond? Aston Martin financial ratings go south as it awaits DBX

Ratings agencies Standard & Poor's and Moody's have taken a dim view of Aston Martin Lagonda. S&P cut its credit rating on the storied carmaker deeper into junk territory this week, and Moody's revised its credit outlook to "negative" after the company raised $150 million in debt from a bond issue at 12% interest, with the option to raise another $100 million at 15%. The Standard & Poor's rating was trimmed by one notch to 'CCC+', which reflects substantial risks and takes it close to default territory after a faster-than-expected cash burn this year. The outlook is negative.  The negative outlook reflects ongoing pressure on profits, a high cash burn, and very high leverage in the face of heightened risks linked to a potential no-deal Brexit and new tariffs on car imports threatened by the United States. The potential salvation for the company is its new DBX luxury SUV, the success of which is critical to its ambitious growth strategy and ongoing creditworthiness, S&P said. But Moody's noted that it's burning cash at a high rate as it nears the launch of the DBX. The British carmaker, known as James Bond's favorite marque, has been hit by falling demand in Europe, the Middle East and Africa. It slumped to a first-half loss in July. Chief Executive Andy Palmer said concerns around Brexit and U.S.-China trade relations were skewing the outlook to the downside, so it was prudent to address investor concerns about its balance sheet. "Taking this debt on — short-term debt — is we think the correct tool to completely remove that thesis that we don't have sufficient liquidity," he told Reuters. "In every substantial and material way, this ensures that we can get through to DBX in spite of what all of those global uncertainties might throw at us." The main tranche comprises notes with an interest rate of 12% due in 2022, while the additional notes could be issued under the same terms if permitted, or could be issued as unsecured notes with an interest rate of 15%, Aston Martin said. Shares of stock in the company, which have had a precipitous fall since they listed in London in October 2018 at 19 pounds, were trading down 5% at 545 pence in early deals. Broker AJ Bell said Aston Martin was known for its high end prices and that situation now also applied to its debt. "These rates are very high and are a major red flag that investors consider the car company to be a high risk entity," it said.

The last gunfighter | 2017 Aston Martin V12 Vantage S First Drive

Here's a deliciously subversive thought for you: Stats are ruining enthusiast cars. We use them to rank the latest models, critique them, and deify them. Sometimes the numbers happen to align with a bunch of intangibles, and the car becomes transcendent – like the Ferrari 458 Speciale, a very special thing indeed. There are cars with great numbers and very little charisma; I've driven many of them. And then, there are the number-based narratives that mislead us. For example, the hoopla around the Mazda MX-5's horsepower, or the continuing lack of a Toyobaru with a turbo – frustrating crosstalk about purist platforms better understood on track than on paper. The 2017 Aston Martin V12 Vantage S is flawed, old, and weak – so say the insidious numbers. A mechanical watch doesn't keep time as well as a quartz one, the numbers say. A tube amplifier produces an inferior sound, the numbers say. The way to fight back is to stop this slavish devotion to the stats and go wind the thing out on good roads in imperfect conditions, which is to my mind the ultimate test of a grand tourer's competence. Southern California was rocked this winter by wild weather – much of the Angeles Crest Highway that dances along the spine of the San Gabriel Mountains was closed due to heavy snow. So much for Plan A. Some roadside rerouting led to some promising roads, so I pointed the Aston into the curves. The V12 roar is a profound part of this car's appeal. Uphill and building steam, the Vantage is a symphony's brass section playing the sounds of wolves on the hunt. Downshifts yowl and snarl like a pack crashing through the underbrush in search of prey. Under deceleration, it sounds like lupine static, unearthly and resonant; wound out it's a frenzied whir. Every stab of throttle brings an immediate response: sound and acceleration in equal measure. If you have even the barest appreciation of joy, you can't stay out of the throttle. This is soulful, warm, analog – but merely honest rather than consciously retro. There's nothing here trying to simulate an authentic experience – it is an authentic experience. It's all right there, under the long and delicate hood – twelve cylinders displacing 5.9 liters. And inside the cabin, a seven-speed manual gearshift lever that moves through a dogleg pattern. This watch requires winding; it's a tactile experience that the quickest, most sophisticated dual-clutch automated manual can't touch.

Aston Martin DBS, Superleggera names resurrected for a new ‘Super GT’

Aston Martin has announced it's bringing back the time-honored DBS name. Originally used in the 1967-1972 GT car, the name was briefly resurrected for a DB9-related model made from 2008 to 2012, and then put back on the shelf. The new car, which Aston refers to a "flagship Super GT," will be introduced in June, as mentioned in a teaser video that somehow reminds us of the xenomorph creature in the "Alien" sci-fi movies. But it's not going to be a big, heavy bruiser, as Aston is also adorning it with a Superleggera badge, referring to super-lightweight construction and dating back to the classic Carrozzeria Touring days of the DB4, DB5 and DB6. Sources such as Autocar say the new, Vanquish-replacing model would have the turbocharged 5.2-liter V12 from the DB11, but tuned for considerably higher output than the DB11's 600 horsepower — perhaps 700 hp is in order. Official power figures have not yet been released, but June isn't that far away. Announcing the re-birth of an iconic name. A distinctive moniker, set to be proudly worn once again by Aston Martin's flagship Super GT. DBS Superleggera.https://t.co/W7Z6SuJFbW pic.twitter.com/1e4ePW84sl — Aston Martin (@astonmartin) April 17, 2018 Related Video: Aston Martin Luxury Performance dbs