LONDON, Sept 30 (Bernama-PA Media/dpa) -- Luxury carmaker Aston Martin has warned about its annual earnings and slashed vehicle production for 2024 as it suffers from supplier disruption and weak demand from China, the German news agency (dpa) reported.
The British group said that it would produce around 1,000 fewer cars than initially planned over the year due to delays in car parts caused by disruptions at some of its suppliers.
The firm said that this, combined with the woes in China amid a more bleak economic outlook, is expected to result in wholesale sales volume decreasing by a “high single-digit percentage”.
It previously forecast high single-digit volume growth.
The group cautioned that this would have an impact on profits, with underlying earnings now set to be below forecasts for 2024.
Aston Martin’s new chief executive Adrian Hallmark said: “It has become clear that we need to take decisive action to adjust our production volumes for 2024 given a combination of supplier disruption, the weak macroeconomic environment in China, and a proactive decision to strategically re-align our production plans to optimise efficiency and achieve a more balanced delivery cadence in the future.”
The group has experienced supplier troubles while ramping up production following the launch of a raft of new models.
It said: “Concurrent with the significant ramp-up in production for the second half of the year, following new model introductions, the company is experiencing a growing number of late component arrivals due to disruption at several of its suppliers.
“As a result, an increasing number of vehicles are taking longer to complete, with these issues impacting the efficiency of operations and delaying the delivery of vehicles.”
Aston Martin delivered just 1,998 cars in the first half of 2024, nearly one-third fewer than the same period last year, while it also said in July that pre-tax losses widened to £216.7 million (US$290 million), down from £142.2 million (US$190.3 million).
The firm is in the middle of a multi-year turnaround effort kicked off by Lawrence Stroll, the billionaire who became its chairman in 2020 after taking a controlling stake in the firm.
Stroll has already had to bring in new shareholders such as Saudi Arabia’s Public Investment Fund in recent years to help bankroll the carmaker.
He has also tried to raise Aston Martin’s profile by entering the brand into Formula One, although the racing business is separate from the listed company.
Stroll said: “When the Yew Tree Consortium made its significant investment in Aston Martin in 2020, we did this with a long-term view of the necessary commitment and turnaround required to unlock the enormous value potential of this iconic brand.
“I remain steadfast in this view and now, with the calibre and experience Adrian Hallmark brings, I am extremely confident in the company’s ability to realise the full potential of its ultra-luxury high performance strategy.”
-- BERNAMA-dpa
