The pandemic has played demonic tricks on the economy, all the sectors have been hit badly. It’s like the industry just lost 50 percent of its health bar fighting this final level boss. The automotive industry has taken some serious damage and who knows how much time it may take to get it back on the road.
The Formula One team owner and supercar manufacturer – ‘McLaren’ has seen sales and advertising revenue take a hit due to the pandemic. Also, their request for a 150-million-pound loan was recently rejected.
Looking at the situation, McLaren wanted to raise up to 275 million pounds by borrowing money against its Woking headquarters and classic car collection. Cars on show at McLaren’s Surrey HQ include F1 winners from the ’80s, ’90s, and Le Mans competitors. The loans would be repaid as car sales pick up and the F1 season starts running according to schedule.
“Like many other British businesses McLaren has been severely affected by the current pandemic and we are therefore exploring a variety of different funding options to help navigate these short-term business interruptions,” the spokesman said.
The McLaren group consists of three major divisions – the supercar operation, the F1 racing team, and the technology research arm. The groups’ revenues were up by 18% last year.
The group employs a total of 3,700 people, out of which 850 are working for the F1 team. The group was also the first to furlough staff in April. The groups’ aid request to the government was rejected because not enough fund-raising options were inspected by the company.
McLaren’s shareholders include Bahrain’s sovereign wealth fund and businessman Mansour Ojjeh.
What do you think? Would McLaren be able to stay afloat with Paul Walsh who recently took over as the chairman? Is mortgaging the cars and headquarters a good idea?
A ton of questions encompass us as we read about McLaren’s condition. Although, it is pretty clear that McLaren would do whatever necessary to stay out of debt.
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