Aston relying on DBX SUV for survival
In the continuing saga of Aston Martin struggles, the company is proposing a new share issue that should help to raise around £245m ($NZ470m) and ensure it survives the downturn caused by the coronavirus pandemic.
This new round of fundraising equates to roughly one-fifth of the value of the company. Yew Tree consortium controlled by Lawrence Stroll, the new chairman of Aston, will buy one-quarter of these shares. Other funding comes from the Coronavirus Large Business Interruption Loan Scheme (£20m) and a further £55m is available from existing loan sources.
In a first quarter that saw the sports car maker lose almost £120m, the latest round of funding is to help the company kick off deliveries of the DBX SUV, which start next month. Stroll stated that demand for the DBX is strong and he believes the new SUV will account for around half of all Aston sales this year.
Aston has been studiously selling off its dealer stock and has reduced production of its sports cars, with the loss of 500 positions. Stroll said this will help with liquidity during the recession and provide further funding to help the firm execute its new business plan.
According to UK Autocar, full production of the DBX has now begun at the dedicated St Athan plant, and deliveries will kick off in July. Aston’s Gaydon facility remains closed while stocks of sports cars are cleared. Ongoing work on the Valkyrie hypercar has resumed, ahead of a 2021 delivery date.
Most all of Aston Martin’s showrooms have now reopened in the UK, though demand for expensive sports cars is low.
Mercedes-AMG boss Tobias Moers has been announced as Aston’s new CEO and will replace outgoing Andy Palmer in August.