Shares in Aston Martin Lagonda have taken a nosedive following a profit warning from its new chief executive, Adrian Hallmark, who has overhauled the company’s financial outlook for 2024.
The luxury carmaker’s stock dropped by 20%, reaching a two-year low of 127½p, after Hallmark revealed that supply chain issues had disrupted production of four recently upgraded models, causing the Warwickshire-based company to miss its targets for the year.
In a strategic adjustment, Aston Martin announced it would reduce its 2024 production volume to 6,000 cars, a 14% cut from its previous guidance of 7,000. The company cited ongoing supply chain disruptions and macroeconomic challenges in China as the primary reasons for the shortfall. The reduction in output is aimed at stabilising production in future quarters, though the company acknowledged it will not be cash flow positive in the second half of 2024, as previously promised.
Hallmark, who joined Aston Martin from Bentley and has been in his role for just a month, noted that the company’s ambitious plans for 2024 required near-perfect execution. “It has become clear that we need to take decisive action to adjust our production volumes for 2024 given a combination of supplier disruption and the weak macroeconomic environment in China,” he stated.
Aston Martin’s production has been particularly impacted by insolvencies at key German suppliers Recaro and Eissmann, which supply seats and dashboards. Sales of the Aston Martin DBX 4×4, one of the company’s top sellers, have also struggled in China, adding to the challenges.
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