Mahindra and the idea of owning Aston Martin
Earlier in October, Aston Martin boss, Ulrich Bez stated confidently, Aston Martin ‘is not for sale’. But with each passing day, more and more reports are flowing in about its sale, and the latest being, the British marquee being sold to Indian utility vehicle manufacturer, Mahindra & Mahindra, a Mumbai headquartered multinational group, with assets worth $6.7 billion (INR 37,222 crores).
First, it was just a rumor, and as days passed, the rumor started to sink in. India’s Mahindra & Mahindra is reportedly very close to buying stake in Aston Martin from Kuwait Investment Dar, who owns 90% stake of the British brand. KID bought stake in Aston Martin back in 2007 from Ford for £479 million (INR 4,266 crores) and are willing to sell 40% of their stake.
CNN states that Investindustrial, an European buyout group is also interested in buying stake in Aston Martin and have placed a bid of £250 million (INR 2,226 crores), but Mahindra have placed a better bid and their chances of owning Aston Martin are better.
Mahindra, the largest truck maker in the world, was also interested in buying Jaguar Land Rover, but was beaten by compatriot Tata Motors back in 2008, and more recently in SAAB. They want to raise their profile, which will help them establish as a serious global player. Buying controlling stake in South Korean brand, SsangYong for $466 million (INR2,588 crores) has also done good to their image, but buying a stake in Aston Martin, the brand that is famous around the world the world, will give Mahindra a much needed brand make-over.
But will it be good for Aston Martin, to be sold to a manufacturer, who has no previous experience in the segment? Aston Martin is often criticized to be outdated. Their cars are still running on a design which was originally developed by Ford, while their engines are bought from the same company, even today. Yes, Mahindra has the money to back Aston Martin, but no experience. But same was the case with Tata Motors, when they bought JLR, and look what they have done.