Aston Martin is entering India, hoping to sell its range of luxury sports cars to the country’s growing number of millionaires and billionaires. While it has taken the iconic company decades to make profits, its history is as exciting as the Bond movies that popularised its stylish cars
Aston Martin, the maker of luxury sports cars which were made popular by secret agent James Bond, is venturing into India. According to reports, the company has appointed two dealers, one in Mumbai and another in New Delhi, and will likely offer the DB5, DB9 and Vantage V8 variants to Indian billionaires.
The decision to come to India is not surprising, as it seeks to expand its markets to earn profits that have eluded the company for a very long time. No doubt, Aston Martin produces some of the best luxury sports cars that money can buy. But at the same time, the company was often on the verge of looking for a buyer as it continued to post losses for over 40 years. For sure, there was never a dearth of eager buyers, whether it was for the company or its products, like Ford Motor Company or the makers of James Bond.
Founded in 1913 by Lionel Martin and Robert Bamford, the company saw many owners. The company produced its first car in 1915, but could not start production because of the outbreak of World War I. While Mr Martin joined Admiralty, Mr Bamford joined the Royal Army Service Corps. In the end, all the machinery was sold to the Sopwith Aviation Company.
The company was restarted after the war with funding from Count Louis Zborowski. In 1922, Aston Martin produced cars that competed in the French Grand Prix, which set records for speed and endurance at Brooklands. The company built around 55 cars for sale in two variants-a long chassis and short chassis.
The company went bankrupt in 1924 and was bought by Lady Charnwood, who put her son John Benson on the board. The company failed again in 1925 and the factory closed down in 1926, with Lionel Martin leaving. Later that year, Bill Renwick, Augustus (Bert) Bertelli and a number of rich investors, including Lady Charnwood, took control of the company and renamed it Aston Martin Motors.
Between 1926 and 1937, Mr Bertelli was the technical director of Aston Martin, and the designer of all subsequent Aston Martin cars during this period, so much so the products were known as the 'Bertelli cars'. These included the 1½ litre 'T-type', the 'International', the 'Le Mans', the 'MKII' and its racing derivative the 'Ulster, and the 2 litre 15/98 and its racing derivative the 'Speed Model'.
Financial problems reappeared in 1932 and the company was rescued by L Prideaux Brune, who funded the company for the following year, before passing it to Sir Arthur Sutherland. The outbreak of World War II again halted production and during the period the company produced aircraft components.
After World War II, Sir David Brown bought Aston Martin and Lagonda, a British luxury car marque. Both companies shared resources and workshops. Later in 1955, Sir Brown purchased Tickford Coachbuilding Company and started the classic series of cars, which bear his initials 'DB'. In 1950, the company announced the DB2, followed by the DB2/4 in 1953, the DB2/4 MkII in 1955, the DB Mark III in 1957 and Italian-styled 3.7 L DB4 in 1958. All the cars established a good racing pedigree, but the DB4 was the key to establishing the company's reputation, which was cemented by the famous DB5 in 1963. The company continued developing the "grand touring" style with the DB6 and the DBS.
While the cars of Aston Martin gained appreciation, the company's financial troubles continued. In 1972, Aston Martin was sold to Company Developments Ltd, which was backed by a Birmingham-based consortium, and chaired by chartered accountant and company director William Willson MBE. But they could not revive Aston Martin and in 1975, following a further bankruptcy event, the company was sold by the Receiver to North American businessmen Peter Sprague and George Minden for £1.05 million.
The new owners turned around Aston Martin's fortunes, and by 1977 it recorded a trading profit of £750,000. The new owners pushed the company into modernising its line, producing the V8 Vantage in 1977, the convertible Volante in 1978, and the one-off William Towns-styled Bulldog in 1980.
In the early 1980s, the company was again hit by economic contraction and worldwide sales tumbled to just three per week. Chairman Alan Curtis and fellow shareholders American Peter Sprague and Canadian George Minden were close to shutting down the production side of the business. But Mr Curtis' fellow Farnham resident Victor Gauntlett bought a 12.5% stake in the company for £500,000 via Pace Petroleum, with Tim Hearley of CH Industrials taking a similar share. Pace and CHI took over as joint 50/50 owners at the beginning of 1981, with Gauntlett as executive chairman.
Mr Gauntlett, who also led the sales team, was able to successfully sell the Aston Martin Lagonda in the Persian Gulf states, particularly Oman, Kuwait and Qatar. Seeking time to develop new Aston Martin products, the company decided to set up an engineering services unit at Tickford to develop automotive products for other companies. Despite all efforts, in 1982, Aston Martin's sales tumbled to an all-time low of 30 cars.
As trading became tighter in the petroleum market, and Aston Martin required more time and money, in September 1983, Mr Gauntlett agreed to sell Hays/Pace to Kuwait Investment Office. He also agreed to sell his holding to American importer and Greek shipping tycoon Peter Livanos, who invested through his joint venture company with Nick and John Papanicalou, ALL Inc.
Mr Gauntlett remained chairman of AML, 55% owned by ALL, and Tickford a 50/50 venture between ALL and CHI. The uneasy relationship was ended when ALL exercised options to buy a larger share in Aston Martin; CHI's residual shares were exchanged for CHI's complete ownership of Tickford, which retained development of existing Aston Martin projects. In 1984, Titan, Papanicolaou's main shipping company was in trouble, so Mr Livanos's father George bought out the Papanicolaou's shares in ALL, while Mr Gauntlett again became a shareholder with a 25% holding in Aston Martin.
In 1986, Mr Gauntlett negotiated the return of fictional British secret agent James Bond to Aston Martin. However, the company needed more funds in order to survive over the long term. In September 1987, Ford bought a stake in Aston Martin. With the change in engine rules in the 1990 racing season and the unavailability of large engineering inputs, Mr Gauntlett handed over the chairmanship and control to Ford. Ford placed Aston in the Premier Automotive Group, substantially invested in new manufacturing and quickly ramped up production. In 1995, the company produced a record 700 vehicles.
However, the financial troubles for Aston Martin continued. In 2006, an internal review of costs and realisable value on investment led Ford to consider divesting itself of parts of its Premier Automotive Group. After suggestions to sell Jaguar cars, Land Rover or Volvo cars, Ford appointed UBS AG to sell all, or part of Aston Martin through auction.
On 12 March 2007, a consortium led by Prodrive chairman David Richards purchased Aston Martin for $848 million. Prodrive had no financial involvement in the deal. Ford kept a stake in the company, valued at about $70 million. The consortium also consisted of John Sinders, an Aston Martin collector, and two Kuwaiti investment companies, Investment Dar and Adeem Investment Company.
During 2007-2008, Aston Martin improved its worldwide appeal by opening more dealers in Europe, as well as branches in China (in Beijing and Shanghai) for the first time in its 93-year history, thus bringing its dealership programme to 120 dealers in 28 countries.
In 2010, Aston Martin finished with earnings before interest, taxes, depreciation and amortization (EBITDA) of £80 million, an improvement of 40% against 2009, while its average sales price went up by 50% since 2007.
Dr Ulrich Bez, Aston Martin's chief executive, said from Geneva 2011: "We are proud to be a real exclusive, luxury company, not made by marketing language, or by volume and price, but a luxury company, made by content, real value, by concept and execution, where simplicity and evolution counts more than fashion and trends."
No doubt, with an ever-increasing number of millionaires, India has become a hot destination for all luxury carmakers, who just a few years ago avoided the country like untouchables. Anyway, the new offerings from Aston Martin will definitely made it tough times for rivals like BMW, Mercedes-Benz, Jaguar, Audi, and last but not the least, Bentley and Rolls-Royce.
TCL has acquired a little over 25% stake in the ammonia-urea fertiliser complex at Gabon in Africa for $290 million (nearly Rs1,300 crore). The 1.3 MTPA fertiliser complex is being set up through a joint venture between Olam and the Gabon government at an investment of $1.3 billion
Mumbai: Tata Chemicals Ltd (TCL), which has acquired 25.1% stake in the ammonia-urea fertiliser complex at Gabon in Africa, plans to invest $170 million in phase two of the project and raise its stake further, reports PTI.
"We have acquired 25.1% stake in stream 1 (phase 1) and are expecting to hold a substantially higher one in stream 2... We are expecting to invest $170 million in stream 2," Tata Chemicals managing director R Mukundan told reporters here.
The company, however, did not specify the exact percentage of stake it would further acquire.
TCL has acquired a little over 25% stake in the ammonia-urea fertiliser complex at Gabon in Africa for $290 million (nearly Rs1,300 crore).
Out of the investment of $290 million, $82 million would be raised through preferential allotment of shares, sale of investments worth $68 million over next three years and the balance through debt funding of $140 million, he said.
The fertiliser complex, with a production capacity of 1.3 million tonnes per annum (MTPA), is being set up through a joint venture (JV) between Olam and the Gabon government at an investment of $1.3 billion.
In the JV, Olam had 80% stake while the Gabon government has 20%.
The time schedule for executing stream 2 would be mutually decided by Olam International, Republic of Gabon and TCL over next 24 months. The project is envisaged to have a capacity of 2.6 MTPA per annum.
Cheering the move, the stock rose 2.31% to Rs 362.70 a share on the Bombay Stock Exchange. Similarly, on National Stock Exchange, the scrip went up by 2.14% to Rs362.95 a share.
A retreat in crude prices and domestic worries pulled the US markets down while ongoing nuclear fears in Japan spooked the Asian pack
Opening after a day’s holiday, the India stock market is likely to open on a tepid note on weak global cues. Wall Street closed lower overnight on retreating crude prices and concerns of the pace of economic recovery. Markets in Asia continued to remain sluggish in early trade on Wednesday, adding to the steep losses seen yesterday. The situation in Japan also kept investors guarded. The SGX Nifty was down 53 points to 5,745 from its previous close of 5,798.
The domestic market, which was closed yesterday, settled a tad above the day’s lows on Monday with the Sensex at 19,263, down 189 points from Friday's close and the Nifty down 56 points at 5,786.
The US markets closed lower on Tuesday on retreating crude prices and worries about the domestic economy. The US trade deficit contracted in February as imports fell more than exports, according to a government report on Tuesday. Exports, after rising in each of the previous five months, fell 1.4% in February to $165.1 billion and imports fell a larger 1.7% in the month to $210.9 billion. The monthly trade gap totalled $45.8 billion, down from an upwardly revised estimate of $47 billion in January despite another monthly rise in prices for imported oil.
A separate Labor Department report showed imported petroleum prices jumped 10.5% in March, the most since June 2009, after rising 4% percent in February.
Meanwhile, oil prices fell for a second day following a Goldman Sachs forecast calling for a fall of almost $20 in the price of Brent crude oil in coming months. The International Energy Agency also said high prices could curb oil demand. Brent crude for May delivery fell $3.06 to settle at $120.92 a barrel. The May Brent contract expires on Thursday. US May crude futures fell $3.67 to settle at $106.25.
In another development, president Barack Obama will meet US congressional lawmakers on Wednesday before delivering his Budget speech laying out his vision to reduce the long-term US budget deficit.
The Dow tumbled 117.53 points (0.95%) at 12,263.58. The S&P 500 fell 10.30 points (0.78%) at 1,314.16 and the Nasdaq declined 26.72 points (0.96%) at 2,744.79.
Markets in Asia were lower in early trade on Wednesday on the situation in Japan and crude prices. Japanese exporters, Toyota Motor, Honda Motor and Toshiba were in the red on global economic concerns.
The Shanghai Composite fell 0.55%, the Hang Seng declined 0.43%, the Jakarta Composite lost 0.17%, the KLSE Composite was down 0.41%, the Nikkei 225 fell 0.11%, the Straits Times shed 0.02%, the Seoul Composite retreated by 0.18% and the Taiwan Weighted was down 0.21%.
Back home, the global financial crisis had worked to the advantage of India due to its slow and steady development and in the near future for every 10 persons who take up jobs globally, six would be Indians, IT major Tata Consultancy Services said on Tuesday.
TCS CEO and managing director N Chandrasekaran said that over the coming years the world face five major challenges: economic situation of a country, the ageing population, emission problems, prevailing political unrest and terrorism.