Britain’s Aston Martin is performing ‘ahead of the market’ in GCC

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Clockwise from above: The DB11 V8 Coupe; the V12 version of the DB11; and the car’s steering wheel and dashboard.
Updated 29 October 2017
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Britain’s Aston Martin is performing ‘ahead of the market’ in GCC

LONDON: British car manufacturer Aston Martin recently launched the DB11 V8 Coupe to the world media in Catalonia, Spain, hoping to attract younger drivers and expand its customer base toward a sales target of 5,000 cars.
Earlier in the year the company unveiled the V12 version of the DB11, which is now one of the top Aston Martin models in the Gulf region. This is the first time that Aston Martin has introduced two engine variants for the same model.
The V8 version is some 115kg lighter and $17,000 cheaper than the V12. Arab News tested both cars and both have their merits. For sheer power, nothing beats the V12 while the V8 offers lighter handling, more balance and top agility. The ratio of production has been confirmed by the company at about 60 percent for the V8 and 40 percent for the V12. The V12 is likely to be stronger in the US and Middle East markets.
The company took this unpreceden­ted step to avoid punitive taxation for larger engines in some markets, such as China. The new V8 will not reach the regional markets until late 2017, according to Christopher Sheppard, the CEO of Aston Martin in the MENA region.
Sheppard admits that the regional GCC markets have been down by 33 percent while Aston Martin managed to outperform the markets by 44 percent. He is hoping to repeat this success in 2018, especially after launching the company’s own financial services. He confirmed to Arab News that every Aston Martin within the range will use hybrid technology within a decade. His advice for people choosing between the two DB11 versions is to test-drive both and make a decision themselves.
These are the highlights of the interview:

Which AM models are best-sellers in the GCC region?
The new DB11 V12 is proving to be very popular but the interest in this car has created greater sales volumes right across the range.

Which is the largest AM market in the region?
The UAE is our largest market, which equates for about 43 percent of the high luxury sport (HLS) market.

Has the current climate of political tension and economic uncertainty affected Aston Martin’s operations in the region? And how are you dealing with the situation?
The market is down about 33 percent across the GCC in the HLS segment but I’m very pleased to report that Aston Martin is performing 44 percent ahead of the market. We have also just launched Aston Martin Financial Services, so we are now able to arrange tailor-made financial solutions to suit our customers’ requirements and circumstances. I’m optimistic that Aston Martin will now achieve greater growth this year and throughout 2018 and beyond.

Has AM got any plans to introduce alternative energy vehicles to the region in the foreseeable future (such as the electric Aston Martin Rapide)?
Yes, Aston Martin is embracing electric technology with a pledge that every car in its range will use hybrid technology within a decade.

What makes AM cars unique among other sports and super cars from the UK and Italy?
At Aston Martin we create beautiful, hand-built and hand-crafted cars which can be used every day — they’re not just suitable for use at the weekend. Our cars are incredibly comfortable to drive when our customers are in the mood to cruise and relax but they are also fantastic fun to drive when our customers want to put them through their paces. There’s nothing quite like the sound of an Aston Martin exhaust note while cruising downtown or out on the open road. When you purchase an Aston Martin you’re not only buying a beautiful car, you’re also buying into a luxury lifestyle. More and more customers from other competitive brands feel that experience when they visit our showrooms or get behind the wheel of one of our cars.

What segment of consumers in the region is the DB11 V8 targeting? And how well do you expect it to do vs. the V12?
Both the V12 and the V8 drive and handle beautifully, so customers will decide their preference when they get behind the wheel.
Some of our competitors have been very successful with V8 derivatives within their model ranges, so there’s clearly a strong appetite for this size engine within the segment, and we would urge these customers to test-drive both the DB11 V8 and the DB11 V12 to make the decision and assess the Aston Martin difference themselves.

When is DB11 V8 due in the regional markets and what is the regional price in dollars? Have you received any advance orders?
We’ll see the first V8 Coupes arriving from sold orders in late Q4 2017 and V8 Volantes in early 1Q 2018. The RRPs for the V8 Coupe start at $220,000.


INTERVIEW: Dan Balmer on steering Aston Martin beyond Bond in the Middle East

Dan Balmer
Updated 17 November 2018
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INTERVIEW: Dan Balmer on steering Aston Martin beyond Bond in the Middle East

  • The Middle East will be a key market for the iconic UK car maker’s second century, says regional chief Dan Balmer
  • Aston has been around for more than 100 years, but has embarked on an ambitious “second-century strategy” under group CEO Andy Palmer

The name is Balmer. Dan Balmer.

The new president of Middle East business for Aston Martin Lagonda, the iconic British car maker beloved by James Bond, is grateful for the glamorous legacy of the fictional super-spy, but also conscious of the need to move on.

“We’ve been with Bond for 50 years, and he has been a real asset for us. But we have a team internally called ‘Beyond Bond.’ If we want to grow the brand audience, into the family and female markets, we have to look beyond the cars that Bond drives,” said Balmer.

That move away from some aspects of Aston’s heritage is reflected across the whole company. Aston has been around for more than 100 years, but has embarked on an ambitious “second-century strategy” under group CEO Andy Palmer.

The company that is emerging will be different, a luxury brand rather than a mere maker of fast boys’ toys; it will be increasingly global, with the Middle East playing a central role; and it will — hopefully — be sustainable, in both a financial and environmental sense.

British actor Roger Moore stands beside an Aston Martin car during a 'James Bond photocall' at Bletchley Park in Milton Keynes, on October 17, 2008. (AFP)

Palmer’s strategy is to steer the group away from the boom-and-bust cycle — it went bankrupt seven times in its first century. He pulled off an essential part of that strategy with an initial public offering (IPO) on the London Stock Exchange last month, which valued the company at $5.6 billion.

Aston will continue to make fast cars, but they will increasingly be more fuel efficient and even electric; and it will put its name to other luxury merchandise — plans for apartments and speed boats are well advanced. Next on the luxury list of Aston-branded items are submarines and vertical take-off aircraft.

Bond, with his love of both the high life and high-tech gadgetry, would probably approve of the strategy. “We’re not hawking the brand around — you won’t see us doing aftershaves and umbrellas. But customers want to buy our cars because they want to buy into beauty, and we’re stretching that now into other areas,” Balmer said.

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BIO: 

BORN 

1976 Southampton, UK.

EDUCATION

Design technician apprentice, Rover Group.


CAREER

•BMW design engineer.

•Rolls-Royce Motor Cars, general manager in Asia-Pacific. 

•Aston Martin Lagonda, president for the UK and
South Africa.

•Aston Martin Lagonda, president for the Middle East, North Africa and Turkey.

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He knows a thing or two about luxury marketing and car design, having previously worked for Rolls-Royce in Asia, based out of Singapore. But now the challenge is to extend the Aston business in the Middle East in a new division within the global set up — covering the Middle East, North Africa and Turkey (MENAT).

Reflecting Aston’s traditional regional business hub in the region, he will be based in the UAE, but the headquarters has been moved from Dubai to Abu Dhabi, where the MENAT HQ was officially inaugurated last week.

Balmer feels that Dubai’s reputation for flash glamor is “a thing of the past,” but also believes that the UAE capital is more in tune with the Aston image. “Aston has an understated elegance and that is also how we feel about Abu Dhabi. It is the capital, recognized as the center of the financial scene, the big decisions are made here, and with Yas Island (the venue for the big Formula 1 Grand Prix later this month) it is a great location for motor sports.”

The Aston Martin DB10, built exclusively for the James Bond film "Spectre," is displayed at the 2015 Los Angeles Auto Show in Los Angeles, California, November 19, 2015. (AFP)

Track racing is still a big thing for Aston, not least because many of its cars are too fast to be driven flat out on roads, but also because it helps the company maintain its high-speed image against competitors such as Ferrari and Lamborghini, the UAE’s sports cars of choice.

Under the second-century strategy, Aston can offer the DB11, the DBS (“a boot in a suit” says Balmer), the Vantage and the Valkyrie as its “overtly aggressive” cars to rival the Italians, and will also soon begin to produce a range of mid-engined cars to take on the likes of Porsche and Mercedes.

Saudi Arabia is big on collectors’ cars, like our Vulcan. But we need to grow the brand.

 

“We are breaking out of our conservative shell. These are track-based products, but meant to be driven on the road, true sports cars,” Balmer said.

But the really radical product is yet to come, and will figure prominently on Middle East roads when it arrives, some time in 2020. Aston has hitherto held off entering the SUV market, which is the fastest-growing sector in the world’s biggest markets, like the US and China.

The DBX is a luxury SUV, a bit bigger than most on the roads now, with five doors and elegant lines. It is aimed at the upmarket family market, and seems a natural fit for the Middle East, which has been SUV-crazy for decades. 

Balmer thinks it will become Aston’s biggest seller in the region. “We just have not had the offering in that segment before, but in the Middle East a majority of luxury car buyers would be SUV, with sports cars a weekend plaything,” he said.

In this file photo, an Aston Martin DB5 is displayed as part of an exhibition dedicated to James Bond at the main hall of La Vilette in Paris. (AFP)

He is relishing the prospect of unleashing the DBX on Saudi Arabia. Aston has been in the Kingdom a long time, with a long-standing partner the Hajji Husein Alireza group and showrooms in Jeddah and (more recently) Riyadh, to be followed by an outlet in Alkhobar.

But Saudi Arabia has not lived up to the potential of its big wealthy population. It ranks behind the UAE, Kuwait and Qatar, roughly alongside Turkey in Aston’s regional sales rankings.

“Saudi Arabia has more opportunity for us. Because of the sheer weight of wealthy individuals it means there are more people who will buy our cars there. Saudi Arabia is big on collectors’ cars, like our Vulcan, and the other beautiful cars we produce like Vanquish and DBS. But we need to grow the brand,” Balmer said.

 

 

“We need to do an education job in Saudi Arabia, both in terms of what Aston stands for in the market and the new products as well. I think Saudis will go for the idea of DBX, and that’s where the key focus will be for us.”

He believes the Saudi market is perhaps more conservative than the UAE in terms of colors and models, but there is potentially a far bigger market among Saudi nationals than Emiratis.

Saudis buy Rolls-Royce cars in big numbers, and having worked for the leader in motoring luxury Balmer appreciates the difference between marketing Rolls and Aston. “They differ in the customer type. Aston buyers tend to be really into their cars. They are ‘petrol heads’ but also discerning.

“Rolls customers know their cars too, and might have an Aston in the garage as well, but they’re buying a Rolls-Royce as more a statement purpose — for business use, or a reward in life. An Aston is more a purchase of emotion and desire,” he said. Whether as a reward or out of emotion, buying an Aston is a considerable outlay. The average price ticket is around $175,000, and such an impulse purchase could easily be put off if personal economic circumstances took a downturn.

In the Middle East, where economies are tied to the oil price, that makes Aston subject to the vagaries of the global crude market. “What’s happening in the region is that governments are diversifying away from oil. (Saudi Arabia’s reform program) Vision 2030, for example, is a big change and good news for us. It will eventually take the volatility away from the macro economic environment. But we will always be dependent to some degree on global economic forces. China now drives the rest of the world in many respects,” Balmer said.

The IPO was an opportunity for Aston’s long-term backers — financial institutions from Italy and Kuwait — to realize some profits on their investments. The share sale raised no new money for expensive research and development, which some analysts criticized.

“There was no massive cash injection because all our new projects were already invested. And we’re making profits. But the IPO secures the long-term future of the company,” Balmer said.

In difficult global markets, the shares have been trading below the issue price since day one, but recently two big investment institutions — Merrill Lynch and Goldman Sachs — put them on the “buy” list. If they achieve sufficient value to be included in the main FTSE 100 list, Aston will be the first car company for 30 years to be on the UK’s main trading board.

That would be something of a triumph for Palmer and the second-century strategy, but Aston has another finishing line in sight before that: The Abu Dhabi Grand Prix. “We’ve got a number of things planned around the race, not least winning it,” Balmer said.