It was big news when Mercedes-AMG acquired 25 per cent stake in MV Agusta. Every other motoring website including ours covered this development but looks like we’ll be talking about this partnership again.
MV Agusta is looking to discontinue its deal with Mercedes-AMG through buying back the shares from the German manufacturer and looking for new investors to run the company. While both the manufacturers didn’t talk about this negative development, it is most likely happening due to the massive debt that the Italian bike maker has accumulated. In fact, some of the debt was acquired by the involvement of AMG which is around €15 million. So the top honcho of MV Agusta, Giovanni Castiglioni will need to look for new investors who can pay the loan amount and at the same time invest in the company’s day to day operations.
In order to keep MV Agusta running, there’s also a new strategy in place that will see a decrease in daily operations including at the production line. The company will reduce the production capacity to between 6000 and 7000 motorcycles from 9,000 units a year, cut down in R&D spend and also reduce the racing budget drastically. All these will affect the employees of the company and some of them might be asked to leave.
Interestingly, Mercedes-AMG wants to keep up relations with MV Agusta but wants to run the company as a majority stake holder. However, the Italian boss doesn’t see that as an option.
