Aston Martin is lowering its guidance for the year, with the automaker blaming supply chain disruption and weak demand in China. The company predicts annual sales will now be about 1,000 vehicles lower than before, it said on Sept. 30.
Adjusted earnings before interest, tax and amortization will be slightly below last year’s level, and the automaker no longer expects positive free cash flow during the second part of the year.
Target cuts are sweeping across the industry.
Volkswagen Group lowered its outlook on Sept. 27, following Mercedes-Benz and BMW, due to a drop in demand in China.
Stellantis also reduced its forecast on Sept. 30.
While manufacturers contend with the downturn, Aston Martin is also struggling with components arriving late, meaning vehicles were taking longer to complete in recent months.
The automaker was rescued by Lawrence Stroll in 2020, but the billionaire is struggling to turn around the company, which has required several capital raises since he took over.
Kerrigan Advisors recently sat down with Donnie and Denny Buckalew, co-owners of Buckalew Chevrolet, the 5th highest-volume Chevrolet dealership in Houston, Texas, to discuss their perspective on the changing auto retail industry and how challenges facing single-point dealers influenced their decision to sell their dealership.
Stroll is betting that releasing more models more frequently and the hype around Formula One racing will help revive the company.
The guidance cut is the first move by new CEO Adrian Hallmark, the former Bentley boss who started this month and is tasked with changing Aston Martin’s fortunes.
The company said on Sept. 30 it will not hit its previous 40 percent gross margin target for this year.
