Aston Martin is seeking a joint venture in China, but it’s not to build Aston Martins. Instead, the British automaker wants to share its lightweight material and aerodynamic technologies with a partner manufacturer in China to improve the performance of other electric vehicles.
In return, Aston Martin seeks battery technology and manufacturing, as the automaker embarks on a path to electrify a sizable portion of its lineup in the coming years.
The joint venture program is part of a five-year, $856 million trade and investment drive that will be a part of Aston Martin’s expansion into China.
The drive to find a technology partner in China makes plenty of sense: Aston Martin needs battery tech but does not have the resources of a large automaker to secure massive supply chains for components or produce a lot of them by itself. For one thing, the automaker’s annual output isn’t that big, and this makes finding suppliers willing to produce smaller quantities of parts difficult. Another issue is getting a supplier to push the envelope when it comes to particular types of parts and technologies on a continuous basis.
Finally, China is the place to go for battery tech and manufacture, and is expected to remain so in the coming years as local automakers race to meet government mandates for “new energy” vehicles within the country. EV battery production in China is expected to grow at a rapid rate, and many automakers with EVs in their lineups are scrambling to secure long-term supply deals.
“Our impressive 2017 performance in China reflects increasing demand for our new and special vehicles,” Aston Martin CEO Dr. Andy Palmer said in Beijing. “The continued roll-out of our new model pipeline, including the company’s first electric vehicle in 2019, will further improve Aston Martin’s market share in this key market, alongside investments we are making to strengthen brand visibility and sales performance. These investments reflect our confidence in the Aston Martin brand and the attractiveness of the Chinese market, which was our fastest growing region in 2017.”
Is Aston Martin dipping its toes into local production of its cars? That’s unlikely in the near future, as the British sports car maker still has a very small and centralized footprint in Europe, making an entirely separate manufacturing facility in China just for the sake of avoiding import tariffs unlikely. Tariffs themselves don’t concern Aston Martin buyers in China all that much anyway; once a buyer is in the Aston Martin price range, a price hike, compared to other markets, is not a deterrent. And even then, there are gray import opportunities from the U.S.
Aston Martin has secured more than $300 million in funds to produce a crossover based on the DBX concept, Automotive News Europe reports. The DBX Concept was unveiled at the Geneva motor show earlier …
Speaking of sales, Aston Martin is also expanding its dealer network in China with a new concept city center showroom in Beijing. There are plans to open 10 new and refurbished showrooms before the end of the year. The focus on sales in China at this point in time is not a coincidence, as Aston Martin plans to introduce its first SUV next year: The DBX is on the way as a 2020 model-year vehicle.