Aston Martin has warned that it will miss its profit targets after tough headwinds continued into December.
The business said that “challenging trading conditions” it flagged up in November have not eased and, as a result, it has registered fewer sales, higher costs for selling each vehicle, and lower margins.
The luxury car maker is hoping its new SUV, which is being made at Aston Martin Lagonda’s new facility in South Wales, will see an upturn in business in the forthcoming year.
Aston Martin chief executive Andy Palmer said: “Our underlying performance will fail to deliver the profits we planned, despite a reduction in dealer stock levels.”
Earnings before interest, tax, depreciation and amortisation (Ebitda) is now expected to be around £130 million to £140 million, the company said.
Shares in the company fell around 14% to 448p after the stock markets opened on yesterday [Tuesday] morning.
On top of having to support customers to finance their buys more than expected, Aston Martin was also hit by a jump in the value of the pound after December’s general election.
Dr Palmer said: “We are taking a series of actions to manage the business through this difficult period.
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“This will include a cost-saving programme alongside a focus on returning dealer stock levels to those more normally associated with a luxury company; winning back our strong price positioning is a key focus.”
An Aston Martin spokeswoman said the recruitment of staff at St Athan will not be affected.
Aston Martin’s troubles put it in stark contrast to fellow luxury brand Rolls-Royce, which sold more cars last year than at any point in its 116-year history.
It exceeded 2018’s record of 4,107 cars, to sell 5,152, a 25% jump.
Both brands launched new SUVs over the period, with Rolls-Royce’s Cullinan making a “major contribution” to growing sales. Aston Martin’s new DBX showed “very encouraging” signs after launching earlier in the year, according to its boss.
Rolls-Royce chief executive Torsten Muller-Otvos said: “This performance is of an altogether different magnitude to any previous year’s sales success.
“While we celebrate these remarkable results, we are conscious of our key promise to our customers – to keep our brand rare and exclusive.”
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However, he warned that the growth may not last into 2020, as sales of the Cullinan stabilise.
Rolls-Royce cars were sold at record rates in Russia, Singapore, Japan, Australia, Qatar and Korea, the company revealed. It has 135 dealerships worldwide.