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Aston Martin Lagonda (Loan: AML) and the stock price has crawled back over the last few months just as I predicted Article on the company. The shares rose to a high of 180p in December, the highest level since September last year. They have recovered more than 93% from the lowest point in 2022.
Does ownership of an F1 team make sense?
Aston Martin is a company in trouble as its debts mount and its supply chain challenges persist. As a result, the company was forced to raise cash last year A share sale to Saudi Arabia, Geely Automobile and other investors. The company diluted existing shareholders by raising more capital.
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These measures were necessitated by the fact that the company was slowly running out of cash. It also had expensive debt of more than £1.3 billion. While Ferrari continued to post record profits, its revenue growth stagnated.
However, some analysts, including myself, continue to question Aston Martin’s stay in Formula 1, the world’s most prestigious racing competition. Aston Martin has no hope of winning the championship for a sport dominated by Ferrari, Red Bull Racing and Mercedes.
Aston Martin spends millions of dollars every year on this team. It is estimated to cost over $140 million. It also pays its drivers more. Sebastian Vettel was there earns Besides the $15 million bonus, it’s about $2 million. Lance Stroll is also making millions.
All this money from a struggling and loss-making company. It posted a loss of $347 million in the first half of 2022. This means Sebastian Vettel and Lance Stroll have earned more money than Aston Martin.
Why Aston Martin Should Quit Formula 1
There are reasons why Aston Martin should consider selling its Formula 1 team. Firstly, Formula 1 is doing well at the moment, thanks to the very successful people Drive to survive Cont. As a result, the number of teams looking to enter the sport is increasing.
For example, Porsche, General Motors and Andretti are considering the move, with Audi expected to enter in 2026. One of the easiest approaches to that is to buy a team like Aston Martin. Lawrence has come for a stroll Open About selling the team to Audi.
Second, Formula 1 doesn’t need an Aston Martin. Teams like Mercedes and Renault sell millions of cars every year so the team is a way of marketing. Aston Martin will sell around 6,000 cars by 2023. I don’t know if these buyers did so because of Formula 1. Instead, the company will still sell cars without the team. Instead, some of this money could be used to promote F1.
Third, selling the team would bring in much-needed cash, especially now that F1 is at its peak. As of 2018, Racing Points is worth about $130 million. That number may have increased in the past few years. By not having a Formula 1 team, the company can focus on product development and increase its performance.
Finally, there is no need to own the team. Car companies have F1 teams to boost their R&D. They can use their F1 technology and implement it in regular cars. I don’t think this cause is worth the cost. Besides, we have seen companies like Toyota and Ford do well after leaving F1.
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