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Aston Martin's lifeline buys carmaker time as SUV hits road

Canadian billionaire Lawrence Stroll and investors have rescued Aston Martin with a 500 million pound cash injection that analysts say will help stabilize the British carmaker whose first sport utility vehicle (SUV) is set to hit the road. Stroll agreed to buy up to 20% of the 107-year-old company and will become executive chairman of James Bond's automaker of choice, which has gone bankrupt seven times in its checkered history. A consortium led by Stroll will invest 182 million pounds($239 million), whilst major existing shareholders - primarily Italian and Kuwaiti private equity groups - will be part of a rights issue to raise 318 million pounds. "It likely gives them enough liquidity to tide them over for a couple of years," said Charles Coldicott, Redburn equity research analyst. Outgoing chairwoman Penny Hughes, who will be replaced by Stroll, spelt out the degree of trouble the firm has been in after core sales fell last year. "The difficult trading performance in 2019 resulted in severe pressure on liquidity which has left the company with no alternative but to seek substantial additional equity financing," she said. "Without this the balance sheet is not robust enough to support the operations of the group." Now Aston will need to turn the financial lifeline into part of a sustainable plan as it delays investment in electric vehicles and cuts its operating costs. A key future milestone includes around 1 billion pounds worth of debt due to mature in 2022. The company also suffers from lower gross margins than rival Ferrari, according to analysts at Jefferies, who have said scaling up is just as important as extra capital. Key to the company's success is its first foray into the lucrative SUV market, a late entrant compared to many rivals such as Volkswagen-owned Bentley and BMW's Rolls-Royce. Aston has built a new factory in Wales to make the model, known as the DBX, which it hopes will attract more women to the brand and some buyers to purchase both it and a vehicle from its traditional line-up. With the DBX model not due to roll off the production line until the second quarter of this year, the firm has taken the cost with only some of the benefit so far. Based in central England, Aston said earlier this month that it already had around 1,800 orders for the car which will retail for 158,000 pounds in Britain, a "materially better" rate than for any previous models.

Aston Martin DBX leads a 224% increase in sales for the British brand

LONDON — Carmaker Aston Martin reported on Wednesday a 224% increase in sales to its dealers, boosted by its first sport utility vehicle, the DBX, as losses fell in the first half of the year. The DBX 4x4, which first rolled off the production line just over a year ago, accounted for more than half of its 2,901 vehicles between January and June. "Building on the success of DBX, our first SUV, we have since delivered two more new vehicles and with more exciting product launches to come we are well positioned for growth," said Executive Chairman Lawrence Stroll. Fictional agent James Bond's car brand of choice has had a tough time since floating in 2018, as it failed to meet expectations and burnt through cash, prompting it to bring in fresh investment from billionaire Stroll last year. The DBX entered production in July 2020 and has helped the company widen its appeal in a lucrative segment of the market which has proven profitable for its rivals. Its pretax loss fell from 227 million pounds in the first half of 2020 to 91 million pounds ($126 million), with the company saying trading was in line with expectations as it aims for 2021 volumes of around 6,000 vehicles. Related video:

Tesla Model S squares off against Aston Martin Rapide S

Can the Tesla Model S electric motor's 443 pound-feet of torque from zero rpm and equivalent of 416 horsepower trump the Aston Martin Rapide S V12's 457 lb-ft from 5500 rpm and 550 hp? Autocar attempts to answer that question by drag racing them - which only leads us to ask more questions. Which is the fastest around a race track? Is the Tesla's relatively low top speed of 130 miles per hour (the Rapide S can reach 190 mph) forgivable in light of its astounding torque? Does that even matter?
We hope Autocar's Steve Sutcliffe will pit the Tesla and the Aston Martin against each other again in the near future to answer those questions, and pick once and for all which one is the preferred luxury sedan. But until then he entertains us in the video below by raving about the Model S's attributes, pitching it into medium-speed sweepers and getting it a bit sideways with nothing but road and tire noise permeating the cabin - something people in the UK can experience for themselves once right-hand-drive cars go on sale there this spring.