Aston Martin Drops Out of the Electric Car Race; Enters Formula 1 Instead
Aston Martin has put their electric dreams on hold indefinitely. After rumours emerged earlier this month that they are going to put the brakes on the development of their first electric car, Rapide E, Aston Martin has finally confirmed that the project has been suspended. The British automaker also had plans to launch an all-electric SUV under their Lagonda brand, but the timeline for that has been pushed from 2022 to “no earlier than 2025”.
The carmaker had a tough time in 2019, and it is largely attributed to the addition of a new factory at St Athan in South Wales, where the highly anticipated SUV, the DBX, is to be manufactured. Whilst selling SUVs seem to be a tried and tested method to keep carmakers out of the red, Aston Martin has been struggling with its cash flow while trying to set up this golden goose.
Although retail sales for the marque were up 12% from the year prior, wholesale orders from the dealers went down by 7%. As they struggled to maintain operations while also building the factory, the company had to borrow £120 million at a high interest rate last year. But even that proved to be insufficient.
Cue entry of Canadian billionaire and Formula 1 Racing Point team owner, Lawrence Stroll, to bail them out. On Friday, a consortium led by Stroll traded £182 million for a 17% stake in the company, the appointment of Stroll as an Aston Martin Executive Chairman..and much more. The agreement required Aston Martin Lagonda to enter into a “legally binding termsheet under which the Racing Point F1 team will become the Aston Martin F1 works team with effect from the 2021 season”. So, it’s bye-bye electric and hello again petrol and burning rubber.
The start of the 2021 F1 season will end a 61-year hiatus for the Formula 1 Aston Martin works team.