THERE ARE many reasons why a Daimler-Benz acquisition of Aston Martin is a good idea that serves both companies well. However, the German giant hesitates in seeing a good deal. Dieter Zetsche, Daimler’s CEO went as far as ruling out a takeover adding “I don't think we could do a better job running a 4000-units-a-year company than Aston Martin's management.”
He said that the difference in scale of the two companies — Daimler sells well over one million Mercedes vehicles a year, while Aston makes just a few thousand — meant that Daimler had no interest in acquiring a greater stake in the British sports car specialist. It seems that Daimler management finds it hard to forget the ill-fated partnership with Chrysler and the unraveled McLaren alliance of recent years.
However, Daimler lacks a halo partner that produces supercars while rival German companies have such partners. Supercars are also very profitable at the present time and an investment in a company such as Aston Martin can give rich rewards. The company is also small enough not to cause Daimler a dent in its finances. Daimler also already owns 5 percent of Aston martin in return for supplying engines and other technologies.
Aston Martin is under new management of Andy Palmer who moved on from Nissan to run the company. Palmer worked closely with Mercedes Benz while he was leading the Infiniti luxury brand at Nissan. The company is small and independent and can certainly do with the backing of a major player such as Daimler. It was let loose by Ford in 2007 and since then it lacked a major technology partner.
There is also potential for sharing platforms after Aston Martin revived the Lagonda brand a few years ago. The company is also looking at V6 engines in addition to the traditional V8 and is considering turbocharging as a future option.
Daimler had nothing in common with Chrysler and their partnership seemed doomed from the start. Yet, this time an acquisition makes good economic sense for both sides.
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— Adel Murad is a senior motoring and business journalist, based in London.
Email: [email protected]
