Friday, April 27, 2007

Development costs give ambitious projects a bumpy ride

By John Griffiths
The ability of specialist car projects to swallow bigger-than-budgeted development costs explains why individual financiers and investment houses have learnt to treat funding approaches with hypercritical scepticism, writes John Griffiths.
One of the most ambitious such private ventures for years is Project Kimber. Led by David James, the company turnround specialist, its business plan is to produce a heavily restyled version of DaimlerChrysler's little Smart roadster and coupé two-seaters at a rate of 7,500 cars a year in Wales; and to revive the century-old AC name as the brand under which to market it.
Mr James and his cohorts have reached agreement in principle with DaimlerChrysler to acquire the intellectual property rights to the car and the plant and equipment to build it. The cars should be much cheaper to bring to market than almost any other such project because they were years under development at a cost far beyond the reach of specialist carmakers and tens of thousands have already been sold.
Read more here.

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