The sale of Aston Martin to a consortium led by automotive entrepreneur David Richards has been broadly welcomed by the car industry but raises questions about the direction in which the new owners will take the famous UK marque.
Richards – an ex-rally driver and former boss of the BAR Formula One team – becomes non-executive chairman after he and his backers paid Ford £479m for the Warwickshire-based car-maker. Ulrich Bez, the man who has overseen Aston’s remarkable turnaround, will remain as chief executive and Ford will retain a link via a £40m preferred equity stake.
Richards, who heads engineering and motorsport business Prodrive, quelled fears about his long-term commitment to Aston by saying/ “The car industry and this business require long-term investment. You can’t come in and out in two to three years as some private equity groups do.”
Loss-making Ford took a controlling stake in Aston in 1987 and acquired full ownership in 1994. Since then, sales have soared from less than 100 to 7,000 last year and Ford said to be considering ramping up production by more than a quarter in the next three years.
Senior research fellow at the Institute of Automotive Industry Research Peter Wells says: “Ford did a pretty good job, so whoever came in was going to have a flying start. But there are issues about where the limits are for Aston Martin. Ferrari used to say that 5,000 cars a year was their limit but they quietly moved beyond that. That trade-off in volume is going to be a difficult one for Aston Martin to manage.”
Aston will be wary of falling into the same trap as Jaguar, which tried to move into the mass market with the X-Type “baby Jag” – a decision that many believe diluted the prestige of the brand.
But an Aston spokesman says the consortium wants to “preserve the qualities” that make the company what it is.
Two of Richards’ major backers are Kuwaiti investment groups and some experts believe that will lead to an expansion into new markets. The Aston spokesman adds: “The consortium’s aim is simple: to ensure all the right ingredients are in place to unlock the potential of the brand.”
It has been suggested Aston will miss Ford’s global scale when it comes to research and development. Most luxury marques in its class – Ferrari is owned by Fiat, while Lamborghini is owned by Volkswagen – have large corporate parents but Mike Moran, who runs motoring consultancy The Automotive Partnership, does not believe that will be a problem.
“The fact that they’re smaller is good news because it will give them a clearer and sharper focus,” says Moran. “I think probably the right person bought it. Dave Richards is a very capable, bright guy who tends to make a success of everything he turns his hand to.”
Richards has realised his dream by taking control of Aston. Now he must prove he is worthy by taking the company to the next level.