ASTON MARTIN has admitted it could breach its banking covenants this year amid turmoil in the financial markets.

David Richards, the motor sport entrepreneur who is chairman of the luxury car marque, admitted the turmoil could lead to a technical breach of its banking covenants later this year. However, he told The Sunday Times that Aston faced no immediate financial problems and claimed it was better placed than rivals to weather the downturn.

The company was bought from Ford by a Kuwaiti-backed investment consortium in 2007 in a £479m deal. If the economic crisis continues, Aston’s backers could be forced to stump up more cash.

The company has slashed 600 jobs and delayed production amid a huge overhang of unsold stock. Richards also admitted the group had delayed spending on product development by six months.

Investment Dar, one of Aston’s Kuwaiti backers, said recently it needed loans of up to $1 billion (£680m) to refinance its own short-term debts. Credit Suisse is thought to be advising on a strategic asset review.

Before Christmas, Investment Dar’s executive vice-president, Amr Abou El-Seoud, said it was considering offers to sell up to 20% of Aston Martin.

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