ASTON MARTIN…ECONOMICS 101!

aston martin

Who wouldn’t want to own an iconic and quintessentially British Aston Martin sports car? Hold the phone Joan, quintessentially…British? Currently the company’s shareholdings are split between 8 different groups…public companies and private equity…and most of them are foreigners! The 102-year-old company has had several owners and has gone bust 7 times. Other than a 2-year period, Aston Martin has never made a profit! It begs the question, why? Having benefited from 52-years of worldwide publicity, thanks to the 007 movie franchise link-up, one would have thought the company’s automobiles would be flying off the forecourts? The fact is, the sports cars are still hand-made, meaning, construction is too labour intensive, and thus too costly to build.  Presumably, if Aston Martin suddenly received thousands of orders, the company couldn’t fulfil the order book! Furthermore, if an owner required a new wing, presumably it would take several weeks, if not months to makes repairs? If you have spent £150 grand on a sports car, would you sit still for your vehicle being off the road for quite so long, when an equivalent priced high-end Merc or Porsche might be back on the road in no time? Although Aston Martin has a presence in rallying (DBR9) and Le Mans, the company has no presence in Formula One. Would FI success make any difference to the order book? In any event, it would probably take 10-years and £500 million to get on the podium! I suggest if it wasn’t for the 007 link-up, no one would have bothered to save Aston Martin, and it would have closed its factory doors decades ago. Thank God the fate of Aston Martin wasn’t left in the hands of the British Government!

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