AML - Stock Market Listing

[oilit]

Great read greasyhands

[Peavey123]

GreasyHands, you were along the right lines.... PIF have an option to buy up to 10% of the AMR team.

[Peavey123]

What's important to note, is Stroll's target of 10,000 sales, £500m EBITDA.

With the interest payments currently at £290m (less £30m when the rights issue pays off about 1/4 of the debt as the CFO said last Friday) that becomes £260m interest payments per annum.

D&A is £315-£330m.
Subtract both and AML still make a loss of £75m.

They could decrease D&A, but when you need to electrify your whole range to try to keep up with the competition.... well....

[ferrisbueller]

GreasyHands said:

I never really paid attention to the Vantage back in 2007. I was and still remain a Porsche fan ( just based on ease of ownership and value). It would be interesting how a Vantage was priced in the peak sales years of 2007/08 vs a 911. Has the lowest priced car in the lineup gone up that much more than a 911 that it is a more difficult comparison? Is the real issue all at the bottom end of the Aston lineup? If so, it's hard to see how raising ASP solves a volume problem.

I think:
AM V8 83k
997 C2 60k
AM Vantage 125k
992 Carrera 90k

One key here, which AM are working to address, is the value of options. Porsche, Ferrari, Bentley et al have made significant money based on the options buyers can spec. I doubt many 992s actually roll out the dealer under £100k. And a short play on the configuration tool yields much higher numbers without being silly.

[Thankyou4calling]

If the company in its current form survives it’ll not sell more than 7000 units a year.

10,000 simply wont happen. No chance.

There’s far too much competition now and that diluted the market.

Every time a target is missed there will be an excuse lined up, how long people accept them is anyone’s guess but there ya go.

I don’t know what the end game is but 10,000 cars a year and £500m EBITDA is fantasy.

[Agent57]

So, sell more cars, or sell fewer cars at higher prices.

The eternal dilemma.

[nickv12]

Am I the only one who has the dilemma of simultaneously not wanting to be overrun by Astons in the market and wanting to see Aston survive.

My childhood memory in the 80's may be rather faded, but Astons were always aloof, exclusive, rare, brutally or intentionally beautiful, aspirational, not-necessarily-the-best-drive-but-didn't-matter...

I like it that they only make 5k sportscars annually and then make a profit with the DBX on top of that. Just charge more. If you want an Aston, you want an Aston.

[Peavey123]

How then, have Ferrari, Lambo and Bentley all sold record amounts of cars in the past 6 months?

Thankyou4calling said:

If the company in its current form survives it’ll not sell more than 7000 units a year.

10,000 simply wont happen. No chance.

There’s far too much competition now and that diluted the market.

Every time a target is missed there will be an excuse lined up, how long people accept them is anyone’s guess but there ya go.

I don’t know what the end game is but 10,000 cars a year and £500m EBITDA is fantasy.

[Minglar]

nickv12 said:

Am I the only one who has the dilemma of simultaneously not wanting to be overrun by Astons in the market and wanting to see Aston survive.

My childhood memory in the 80's may be rather faded, but Astons were always aloof, exclusive, rare, brutally or intentionally beautiful, aspirational, not-necessarily-the-best-drive-but-didn't-matter...

I like it that they only make 5k sportscars annually and then make a profit with the DBX on top of that. Just charge more. If you want an Aston, you want an Aston.

Would tend to agree Nick. I don’t live too far from my MD but any model of Aston is still a fairly rare sight in my neighbourhood. It’s pretty clear what Strolls plan is on pricing. And as I said in one of the other threads, I’m fully expecting a sizeable jump in prices if/when the new upgraded line up is revealed. Stroll is obsessed with “ultra luxury” whatever that means, and charging more seems to be his key element in that strategy. But at the end of the day, AM have to make cars people want to buy, and with the competition so fierce from the big boys, that is a very hard thing to do. Looking back at 2007, DB9 was still fresh. Vantage was a beautiful attainable thing and it was a major threat to the dominance in that sector of 911. I’m somewhat surprised that the average selling price for AM during that time was in the low £70k’s. Mine was delivered new in March 2007 and it cost around £90k, although that was with most of the available options ticked. The world is of course a very different place fifteen years on. I still think the only way out is for AM to be swallowed up by one of the big names. And after what happened a few weeks ago, I guess Geely is no longer an option.

Best Regards

Minglar

[Dewi 2]

ferrisbueller said:

I think:
AM V8 83k
997 C2 60k
AM Vantage 125k
992 Carrera 90k

One key here, which AM are working to address, is the value of options. Porsche, Ferrari, Bentley et al have made significant money based on the options buyers can spec. I doubt many 992s actually roll out the dealer under £100k. And a short play on the configuration tool yields much higher numbers without being silly.

Yes, spot on with the V8V.
AML certainly make the most of their options card.

List
2007 = £ 82,800
2009 = £ 85,000
2011 = £90,895

Ref options, my 2009 car at £85k had options costing £8,461 (10% of list).
Two years later it was mine. A brand new (appearance) car, MD retail sale, at 40% below original cost.
Seemed fair value to me. Perhaps not so good for the original owner.

Interesting to apply the same calculation to the present Vsntage.
It gives £82,500 MD retail, for a 2 year old car, but I think they are being advertised for more than that.

[ferrisbueller]

Dewi 2 said:

ferrisbueller said:

I think:
AM V8 83k
997 C2 60k
AM Vantage 125k
992 Carrera 90k

One key here, which AM are working to address, is the value of options. Porsche, Ferrari, Bentley et al have made significant money based on the options buyers can spec. I doubt many 992s actually roll out the dealer under £100k. And a short play on the configuration tool yields much higher numbers without being silly.

Yes, spot on with the V8V.
AML certainly make the most of their options card.

List
2007 = £ 82,800
2009 = £ 85,000
2011 = £90,895

Ref options, my 2009 car at £85k had options costing £8,461 (10% of list).
Two years later it was mine. A brand new (appearance) car, MD retail sale, at 40% below original cost.
Seemed fair value to me. Perhaps not so good for the original owner.

Interesting to apply the same calculation to the present Vsntage.
It gives £82,500 MD retail, for a 2 year old car, but I think they are being advertised for more than that.

Ferrari have been known to do things such as mandate a minimum 25% uplift in options to guarantee a buyer a build slot. By limiting overall build, rather than selling every car they could, they've got themselves into a position to do such things. LdM steadfastly refused to chase the sales volumes, only since he moved on were numbers lifted from circa 8k, and even then 10k was only exceeded a couple of years ago. I note that the SP3 Daytona is £1.7m. I think they're making 399 and you have to be selected to be able to buy one. And all the while with an underperforming F1 team

If you can create that demand and rinse all that additional margin out of customer cars specified to be a personalised bespoke item, which I assume some people want when shelling out the kind of money we're talking about, then you don't have to chase volumes.

I don't think AML should be targetting Ferrari, per se, but there are lessons to be learned. I'm not sure what the Purosangue will do to this picture, but no doubt they'll sell. Bentley and Lamborghini are shifting 5k Bentayga and Urus a year, each. We're not talking huge volume numbers relative to wealthy individuals.

[Jon39]

Since becoming an Aston Martin owner and subsequently discovering this forum, I have been able to gradually learn more about AML.

It is quite amusing sometimes, when reading comments by supposedly eminent people.

Professor David Bailey of Birmingham Business School recently explained to Forbes, that he thinks a takeover of AML would make more sense.

"The latest effort by Aston Martin to raise cash buys some time but doesn’t change the fundamental challenges facing the firm. It is difficult to see how it can survive as an independent player in a rapidly evolving industry with high costs of developing new EVs. Turning down the recent investment offer by Geely seemed a particularly bad call - it would have raised more cash and opened up access to platform sharing with Lotus, also owned by Geely. A takeover seems increasingly likely,” Bailey said.

https://www.forbes.com/sites/neilwinton/2022/08/01...

Members here may think Professor Bailey could be correct about the eventual future ownership by a big car manufacturer (not convenient yet though, because of the sponsorship flow to a privately owned F1 team), but we have to laugh about his suggestion that sharing platforms with Lotus would be helpful.

When the VH platform was originally developed (early 2000s), it was based on the Lotus platform. Originally the alloy structures were made for Aston Martin by the Lotus chassis supplier in Worcester. Later the manufacturing was done by AML.
The supplier has since been bought by Lotus (renamed Lotus Lightweight Structures) and then many years later, moved their manufacturing to Hethel.

Ooops.

Edited by Jon39 on Friday 5th August 13:40

[cardigankid]

There's also the small matter that when trouble breaks out between China and Taiwan, as we are frequently being reminded that it is going to, China will be the next country to be subject to AUKUS led sanctions, and we won't be allowed to to buy Aston Martins, by order!

[12TS]

More from SSO

In the last year it would appear that Aston has been living off customer deposits and the backs of its suppliers, but that play has likely run its course. Its biggest market, the Americas has cratered, and sales are well off the pace needed to hit the full year projections. The Valkyrie continues to be a mess, but the damage here is all self-inflicted. Add this altogether and it’s no surprise that £1.03 bil. of shareholder value has evaporated so far in 2022. In this modern financial Shakespearian tragedy, no one has suffered more than the poor heavily diluted AML shareholder.


https://karenable.com/turtle-soup-aston-martin-1st...

[Jon39]

Thank you for your commentary about the H1 Results, SSO.

LS must spend ages refining his statements, although not so much his replies during the Q&A, which might be why they have been deleted from the website.

Lawrence Stroll, Executive Chairman commented: “We have continued to make strong progress in our vision to become the world’s most desirable, ultra-luxury British performance brand during the first six months of 2022”

Ambiguity can be very useful for causing confusion. When read word by word, 'Progress in our vision', not progress with the business.

A tiny point I noticed.
"... we had a boat of another couple 100 going to China ..."
Presume therefore 200 and 'another' 200, making 400.
Have 400 DBXs been sold in China, each one built to customer order? Perhaps one of the boats had trouble in the Bermuda Triangle.


Changing to the subject of Nebula. Clearly relations have broken. We wondered on this forum, whether the 19 pairs of R-reforged Zagato twins, have been completed ? Being assembled in Warwick, but the balloon probably went up before many had been built. Do you have anything that you can tell us about that? I guess AML would have stopped co-operating with the project. Most odd to end one of the most successful dealerships.

[Peavey123]

I saved the link, just as well.

https://edge.media-server.com/mmc/p/8sqgxcvi

[Peavey123]

My personal highlight is 41'44"
Just about Lawrence.

[Jon39]

Peavey123 said:

My personal highlight is 41'44"
Just about Lawrence.

The two killer questions start at 31:40.
Don't think LS was too pleased about those, but explained that the proposed rights issue capital raise would always provide a cushion on the balance sheet (well it would, if only they could fund a cure for their money outflow disease).


LS said, "The share price is clearly where it is, not because of the fundamentals, the fundamentals have never been stronger, we went from 2,000 cars to 4,000 cars ......."

Never been stronger. -
Serious investors would certainly not consider the number of cars, as a major part of the business fundamentals.
Various fundamental facts are considered, in order to estimate future intrinsic value. It is precisely those aspects, which has put the share price where it is.

LS. "Me and my board getting very frustrated with the share price, ...."

Forget talking about EBITDA nonsense, report a growing positive EPS, reduce debt to a manageable level. That should end the frustration for you and your board.

Edited by Jon39 on Saturday 6th August 19:18

[SSO]

Peavey123 said:

My personal highlight is 41'44"
Just about Lawrence.

"are we done"

[SSO]

Jon39 said:

Thank you for your commentary about the H1 Results, SSO.

LS must spend ages refining his statements, although not so much his replies during the Q&A, which might be why they have been deleted from the website.

Lawrence Stroll, Executive Chairman commented: “We have continued to make strong progress in our vision to become the world’s most desirable, ultra-luxury British performance brand during the first six months of 2022”

Ambiguity can be very useful for causing confusion. When read word by word, 'Progress in our vision', not progress with the business.

A tiny point I noticed.
"... we had a boat of another couple 100 going to China ..."
Presume therefore 200 and 'another' 200, making 400.
Have 400 DBXs been sold in China, each one built to customer order? Perhaps one of the boats had trouble in the Bermuda Triangle.


Changing to the subject of Nebula. Clearly relations have broken. We wondered on this forum, whether the 19 pairs of R-reforged Zagato twins, have been completed ? Being assembled in Warwick, but the balloon probably went up before many had been built. Do you have anything that you can tell us about that? I guess AML would have stopped co-operating with the project. Most odd to end one of the most successful dealerships.

Thanks

On the Zagato twins, no idea but I will see what I can find out.

On the China DBX's hard to tell as "shipped" and "delivered" seem to be used rather loosely when convenient at AML