It looks like Geely is looking to dip its hands into another prominent automaker. The Financial Times reported that Geely is in talks with the management and investors of Aston Martin, with the possibility of pumping much-needed cash into the luxury British carmaker.
Four people familiar with the discussion said Geely is conducting due diligence as it prepares to take a stake in the company, which currently is in need of fresh finances. However, the talks may lead to a technological partnership instead of a full investment, one of the four said.
Following the announcement, Aston Martin’s share price rose 15%, but that pales in comparison to the 70% plunge it suffered after going public in 2018 with unexpectedly low profit levels. During the first half of 2019, the firm posted £78.8 million (RM417 million) in losses, and share prices continued to slide amid slowing global sales.
However, Geely, which owns Lotus, London Taxi Company, and Volvo, is only one of several parties interested with investing in Aston Martin. Formula 1 billionaire Lawrence Stroll is reportedly the closest to making an investment totalling £200 million (RM1.06 billion), which would grant him control of 19.9% of the company. Stroll may go on to up his stake by buying from existing Aston shareholders, or in the open market, according to a source close to him.
For now, things remain up in the air, but the product side of things mustn’t remain affected. Aston Martin is banking on its new DBX SUV for recovery, targeting China and the US as two of its most important markets.
Company CEO Andy Palmer said he aims to sell at least 4,000 units of the DBX globally in the first 12 months of launch, with deliveries scheduled to begin mid this year. At peak sales, he said the company could even sell up to 5,000 units a year. This means the DBX will be the largest-single volume Aston Martin model, ever. In 2017, it sold a grand total of 5,117 luxury GT and sports cars.