Automakers Aston Martin (OTCMKTS:ARGGY) and Lucid Motors (NASDAQ:LCID) have launched a partnership, sending both LCID stock and ARGGY stock higher in early trading. Under the deal, Lucid will get a 3.7% stake in Aston Martin in exchange for sharing its electric vehicle (EV) technology with the famous automaker. Aston Martin stock and LCID stock are trending on social media today in response to the news. Both are up over 10% at the time of writing.
Aston Martin, known for its affiliation with the fictional British superspy James Bond, intends to launch its initial EV in 2025.
More About the Agreement
Under the deal, Aston Martin will utilize Lucid’s EV technology, including its powertrains and battery systems. The alliance is reportedly worth over $450 million in total. The agreement requires Aston Martin to “spend a minimum of £177m on developing powertrain components.”
Additionally, Lucid will receive technology access fees from Aston. The fees will come in the form of a combination of Aston Martin shares and phased cash payments.
Also noteworthy is that Lucid will provide Aston Martin with technical support under the agreement.
One of the technologies that Aston Martin will receive access to under the deal is Lucid’s twin motor drive unit. According to LCID, the unit offers ” prodigious power (and) torque vectoring to extend the capabilities of the car beyond that achievable with a passive all-wheel-drive system.”
The American EV start-up reported that Aston Martin selected it through a “competitive process.” However, both have significant investment support from the Saudi Public Investment Fund (PIF).
More About Aston Martin and ARGGY Stock
Chinese automaker Geely has a 17% stake in Aston Martin, which is also working with Mercedes-Benz on its EV strategy. Geely “doubled” its stake in Aston Martin in May. The company describes its vehicles as “luxury sports cars.”
Aston Martin’s vehicles cost hundreds of thousands of dollars. The cheapest model, the Vantage, starts at around $143,000.
ARGGY stock has soared 154% so far this year.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
