Aston Martin in technical partnership with Mercedes-AMG GmbH

Thursday 25 July, 2013, Gaydon: Aston Martin is today announcing moves towards a technical partnership with Mercedes-AMG GmbH, a 100% subsidiary and high performance brand of German multinational automotive corporation Daimler AG. A Letter of Intent to this end has been signed today and both parties are working towards signing definitive agreements before the end of the year. Such agreements are subject to applicable regulatory approvals.

The proposed deal will see Aston Martin access significant Mercedes-AMG GmbH and Mercedes-Benz Cars' resources, allowing the development of bespoke V8 powertrains and the use of certain components of electric/electronic (e/e) architecture.

Daimler AG will own a stake of up to five per cent non-voting shares in Aston Martin depending on the progress of the agreement. The company will join the existing shareholders that include Investment DAR, Adeem Investment and Investindustrial.

The technical partnership will support Aston Martin's launch of a new generation of models that will incorporate cutting edge technology and newly-developed bespoke V8 powertrains. An essential element of the planned partnership is a supply agreement between Mercedes-AMG, Daimler AG and Aston Martin.

Aston Martin, which is Britain's most exclusive sports car company, is celebrating its centenary this year. The company will continue to manufacture all of its sports cars at its Gaydon headquarters in Warwickshire, England.

Aston Martin Product Development Director Ian Minards said: "We have selected AMG specifically as the basis for this powertrain development process.

"Aston Martin sources cutting edge technology from key suppliers around the globe and the opportunity to include content from Mercedes-AMG GmbH in our next generation sports cars is, clearly, good news."

He added: "Working with Mercedes-AMG in this way while, of course, remaining independent and preserving the unique character and style of Aston Martin that has been the mainstay of the company throughout its 100-year history, points to a very bright future for the company as it starts its second century in business."

Ola Källenius, Head of Mercedes-AMG GmbH said: "We are proud to work with Aston Martin and provide them with powertrain and e/e components for their forthcoming sports cars. This is proof of AMG's technological and performance expertise and a real win-win situation for both sides."

The companies confirm that their respective engineering teams will work together to optimise the implementation of this technical partnership.

Both parties have agreed that no further details of the planned technical partnership will be revealed for the time being.

The development of a partnership between Mercedes-Benz and Aston Martin has been a long time coming. The news dates back to 2008, and over the five years since was supposed to lead to a rejuvenation of both the Maybach and Lagonda brands. That program ultimately fell apart, but the tie-in was forged afresh in July when the two automakers signed a letter of intent over a renewed partnership. And now that partnership has been formalized.

In a deal just announced, Mercedes-AMG will build a new V8 engine for Aston Martin that will power a new generation of luxury GTs for the British marque, presumably to replace the 4.7-liter V8 in the Vantage. The relationship appears to be similar to the one already in place between AMG and Pagani, only in this case, will involve Daimler taking as much as a five-percent stake in Aston Martin and an observer seat on Aston's board.

The technical partnership is also set to lead to the supply of electric and electronic systems, and could incorporate "additional areas of cooperation in the future." Whether that will include a fresh attempt at reviving Lagonda remains to be seen, as does the future of Aston's long-serving, Ford-based 6.0-liter V12 engine.

As part of an increasingly close partnership, Mercedes-Benz parent company Daimler is reportedly preparing to increase its stake in Aston Martin by another one percent, bringing the German automaker's shares in the British company up to five percent.

The rapprochement between the two has been in the works for years now, and is finally beginning to take form. Mercedes-AMG is in the midst of developing a new engine with and for Aston Martin in an apparently similar arrangement to that which it has with Pagani. But that's not the extent of it.

Daimler will also furnish Aston Martin with electrical systems and other components, said to lead up to the eventual sharing of platforms: one to underpin future GTs and another to serve as the basis for a long-mooted Aston Martin crossover, now said to be back on the table and slated to launch in 2017. The prospect of using the partnership to reinvigorate both the Lagonda and Maybach luxury brands, however, has since been taken off the table, with both parties continuing those projects independently.

The deal is said to have been brokered by Investindustrial. The Italian concern bought 37.5 percent of Aston Martin over a year and a half ago. Prior to selling Ducati to the Volkswagen Group, Investindustrial had brokered a partnership between AMG and the motorcycle manufacturer.

Mercedes, for its part, had a similar relationship with another British sports car manufacturer before it and McLaren parted their separate ways, while Aston Martin aborted its partnership with Toyota.