How does billionaire Lawrence Stroll plan to straighten out Aston Martin?
The losses of luxury carmaker Aston Martin have deepened, actions has plunged to record levels and announced plans to part ways with his finance boss following a £ 500million bailout deal last month.
Fashion and Formula 1 billionaire Lawrence Stroll (pictured) led a consortium that saved the company, which threatened to go bankrupt for the eighth time in its 107-year history in January.
But Canadian Stroll faces a series of issues to be resolved at Aston Martin – whose cars are a staple in the James Bond movies.
How bad are today’s annual results?
Warwickshire-based Aston Martin recorded a pre-tax loss of £ 104million, up from £ 68million in 2018, after a 9% drop in dealer sales.
Sales in China, Aston’s fastest growing market, jumped 28% during the year, but fell in the UK and Europe.
Shares fell 14% to a record low of 328p after the company announced its results. This left the company worth less than a fifth of its value when it went public in October 2018, when shares began. trade at £ 19.
The brand said CFO Mark Wilson would leave by mutual agreement.
Aston Martin expects “significantly lower” sales in 2020 as it tries to reduce the number of cars owned by dealers and has also warned that the coronavirus outbreak could affect its supply chain and sales.
Aston Martin CEO Andy Palmer said: “2019 has been an extremely difficult time for the company. “
Who is behind last month’s bailout?
Stroll has led a consortium that will invest £ 182million in exchange for 16.7% of the automaker for £ 4 a share. The automaker will also raise £ 317million through a rights issue backed by two of its major shareholders, the Italian group Investindustrial and the Kuwaiti investment fund.
Stroll made a name for himself in fashion investing in Polo Ralph Lauren, Tommy Hilfiger and buying a controlling £ 100million stake in Michael Kors in 2003, which was successfully introduced eight years later.
The entrepreneur, reputed to be worth $ 2.6 billion, controls the Racing Point F1 team, which will become the Aston Martin F1 team for at least ten years from the start of the 2021 season.
How does Stroll plan to stem Aston Martin’s losses?
The group has put aside plans to launch the Rapide E, Aston Martin’s first fully electric vehicle. The relaunch of the Lagonda brand, for which it plans to manufacture the world’s first zero-emission luxury car, has been postponed to 2025 from 2022. For now, it will focus on hybrid vehicles, starting with the model. Valhalla in 2022.
The company said it would review its business and plan to cut costs by £ 10million per year.
The company hopes the upcoming launch of the DBX sport utility vehicle, for which it has at least 1,800 orders, will bring much needed revenue.
The automaker is also hoping for increased sales of the latest James Bond film, No Time to Die, released in April. Four Aston Martin cars will feature in what she hopes will be a blockbuster.