TVR seeks £25m investment to secure future
Short-term funds needed to move long-awaited Griffith to production phase
TVR is hoping to raise the £25m it says it needs to finally start building the new Griffith and help it adopt a self-sustaining business model. The launch of a new bond issuance - detailed in a new report by Audacia Capital - is expected to provide the necessary liquidity. It comes five months after the firm confirmed its powertrain deal with Ford, and revealed that its Ebbw Vale factory needs a new roof before it can begin building cars. The investor report makes it clear though that its ambitions do not stop with the Griffith, outlining the ambition to follow it up with three more cars, should it receive financing.
TVR is targeting the Dublin Stock Exchange with its bonds, set to mature in 2025. In the document, first reported by Autocar, TVR pitches its business plan as a low cost, high return investment, thanks in part to the use of those Ford engines, a “low energy assembly process” and externally replicable car production. The company says these things will make it easier to enter new territories, “thereby avoiding import tariffs”, suggesting its Wales HQ won’t be the only place that needs a roof in the future.
Interestingly, TVR’s says its plans already encompass electrification, claiming that the Griffith’s spaceframe core and surrounding carbonfibre structure are ready for hybrid and full EV power sources – set to be supplied by Ford as part of that new deal. It reckons this will help to future-proof investments, while also enabling expansion to a four-model line-up by the close of this decade. Sales are predictably intended to start in Britain, with continental Europe, North America, Japan and the Middle East following, along with Australia.
The report makes clear there's money in the pot already, with TVR brand owed £8.2m from debtors, although the business has loans with the Welsh government and finance company Fiduciam Nominees, worth £2m and £3m respectively. Its Ebbw Vale factory is unfinished and obviously requires further investment, while the only employees currently on its books are the team of directors. TVR has a fully functional Griffith prototype – complete with its Gordon Murray-designed aerodynamics, 500hp powerplant and claimed near 50:50 weight distribution – to demonstrate its potential.
Additionally, TVR hints that both cheaper and pricier versions of the Griffith could be launched, with “different price points… currently under strategic evaluation”. Different body shapes, track and racing models are also said to be in the pipeline, which is a conspicuous nod to TVR's former glory days, most notably the Tuscan Cup, which provided the market for 100 chassis to compete.
When it was introduced in 2017, TVR said the 5.0-litre V8 two-door would cost about £90k and customers could expect their cars by 2019. That obviously hasn’t happened – and, anecdotally at least, the TVR forum on PH suggests that some depositors are unimpressed with the progress made in recent months. Whether news of the bond issuance allays their concerns or not, the firm is clearly exploring every avenue available to it. As ever, we'll keep our fingers and toes crossed that TVR makes a triumphant return to British roads in the not too distant future.
Would be interesting to know where this aged debt comes from given that they have no sales - is that how they are accounting for the deposits ??
Will be interesting to see what yield these bonds offer ( suspect it is going to have to be very high ) and hard to see how they will re-pay them in 2025, other than issue new ones.
You would have to be really happy treading that fine line between brave and foolhardy to invest in these.... Given the problems that Mclaren and Aston are having at the moment, I just can't see how a smaller volume manufacturer, selling at a lower price point, and needing to invest more heavily to build a factory from scratch can possibly prosper.
I genuinely thought it was going to happen but it quite clearly now isn't.
Even if this does now happen the car is going to be an old design.
However I remember having a good look at that car (that actual car) at a show 5 or so years ago.
At the time, I worked in the Engineerinsg and Design team for a commerical vehicle builder.
The fit and finish (particularly, the bonded glass, leather clad dashboard etc) was of a standard that would have seen our vehicle snagged, sent back to the factory and requiring rework before even daring to let the customer see it. And this was the motor show car.
I would cope with this. Just as those who bought new Cerberas, Chimearas and Tuscans did 20 or 30 years ago did.
However if they really think that in 2020, they are going to pry customers from the Porsche, BMW, Evora even with that level of quality, they are much, much mistaken. Things have sadly moved on.
I'm really tempted to take a walk down to the Senedd next week with my best Straw Boater to tell them about this great idea I've got for a Monorail. All I'll need is a catchy tune and a business plan written in pure fiction and they'll award me (or rather my freshly registered Limited Company) millions of pounds to 'invest' in creating a bit of buzz in the media, I'll probably squeeze a bit more out of them a year later before the final Coup d'état, a very public begging letter or "opportunity to invest" in a venture that could't possibly succeed.
2.1 Basis of preparation of financial statements
The financial statements have been prepared under the historical cost convention unless otherwise specified within these accounting policies and in accordance with Section 1A of Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and the Republic of Ireland and the Companies Act 2006 .
The following principal accounting policies have been applied:
2.2 Going concern
As widely reported in the media COVID-19 is impacting many businesses at the time at which these accounts are being filed. We are at a stage of the development of Griffith and the preparation of the factory in Wales where we can effectively work remotely with our various partners. Consequently, we do not see any hindrance to ongoing operations caused by COVID-19. Additionally, since we are not yet retailing built vehicles, we are not experiencing the significant market pressures that other established OEMs within the sector are currently facing. The COVID-19 pandemic presents no immediate or foreseen risk to TVR operationally or as a going concern, given the operations are still in the pre-production stage.
The Company has made significant progress with product development and, in particular, the Welsh Government have now finished the factory refurbishment tender process and have selected a preferred contractor.
In order to fully execute the Company’s business plan there is a requirement for additional funding during the 2020 financial year, which will be supported via the issue of a securitisation bond. It is believed due to the current stage of negotiations and significant interest in the business, the necessary funding will be secured to ensure the Company continues as a going concern.
At the time of approval of these financial statements the directors have no particular reason to expect that such funding will not be secured, and that this mitigates the material uncertainty related to the aforementioned conditions that may cast any significant doubt on the company’s ability to continue as a going concern.
As a result they believe that the Company will continue to operate as normal and, accordingly, they consider that the going concern basis of preparation continues to be appropriate.
The financial statements do not include any adjustments that would result if the additional funding required were to prove unavailable.
The feeling here is very negative. Don't get me wrong, I really don't see this happening, which as a Welshman and a TVR fan I find really disappointing, but I for one am actually rooting for them. I hope they find enough brave souls to commit a bit of cash to this and can actually launch it, dated or otherwise.
Go TVR!
However I remember having a good look at that car (that actual car) at a show 5 or so years ago.
At the time, I worked in the Engineerinsg and Design team for a commerical vehicle builder.
The fit and finish (particularly, the bonded glass, leather clad dashboard etc) was of a standard that would have seen our vehicle snagged, sent back to the factory and requiring rework before even daring to let the customer see it. And this was the motor show car.
I would cope with this. Just as those who bought new Cerberas, Chimearas and Tuscans did 20 or 30 years ago did.
However if they really think that in 2020, they are going to pry customers from the Porsche, BMW, Evora even with that level of quality, they are much, much mistaken. Things have sadly moved on.
We can thank the decision by succession of governments in the UK to focus on services industry, the lack of management knowledge and skills within the manufacturing industry, as well as the lack of appetite and appropriate finance to help support these ventures..
Oh and did I mention the adversarial nature of the relationship between management and the workforce/unions etc.?
British manufacturers were struggling the compete even when the likes of BL was about.
Then you have coronavirus and arguably Brexit wading in...
It will be very high mountain to climb if UK is to attempt at competing with the others who have been in the running since the UK decided to sell up and pursue inward investment.
The UK could take advantage of the current EV distruption and seek to build something akin to a Tesla, but again, the ecosystem is not conducive for this.
Instead, the UK will probably be supplying individual parts, like for example, driveshafts, or battery packs...
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