LONDON -- Aston Martin is on its way to solving the company's long-standing overstocking issue that has impacted the company's profitability for years, CEO Tobias Moers said.
The microchip crisis has reduced inventories for nearly all automakers but Aston Martin's lower stock levels are less to do with supply shortages and more to do with the company pushing retail sales above sales from stock, Moers told Automotive News Europe during an earnings call.
Aston Martin's current inventory is around 700 sports cars and a similar number of DBX SUVs, "the lowest level ever for the company," Moers said.
Aston Martin is seeking to raise its average selling price and the best way to do that is persuade customers to order models specific to them via the dealer or through the company's website.
"Retail-type orders are always a higher ASP [average selling price], always," Moers said.
Aston Martin raised its average selling price across all models including high-price, low-volume specials to 157,000 ($210,300) pounds in the first nine months from 137,000 pounds through 2020, the company said. In 2016 the average selling price was 116,000 pounds.
The company lost 98 million pounds for the quarter ending Sept. 30, but its year-to-date loss of 189 million pounds is an improvement on last year's loss of 308 million pounds over the same period.
Moers said the U.S. and China, Aston Martin's two largest markets, remain "dealer-order regions" where customers do not like to wait for the cars they purchase but that was changing. "We see movement into more retail-like orders in North America and China," he said.
Aston Martin worked during the pandemic to improve its online configurator to encourage more customers to pick their own personal specification. The purchase part of the website now includes the functions to engage with one-on-one conversations with sales staff.
The new configurator has resulted in a 300 percent rise in "hot leads" for dealers and a "really tremendous" 15 percent to 20 percent increase in the take-rate for options, again improving pricing, Moers said.
Aston Martin has struggled to reduce the oversupply at dealerships at recent years, which in turn led to discounting.
Moers blamed production overcapacity at its sports car factory in Gaydon, England, leading to the former AMG CEO to close one of the two production lines there.
"With two you are not flexible and not reacting to market demand, so you are driven to push wholesales [to dealers] to get the assembly lines up and running," he said. "Now we can easily adjust for output."
Moers said that the costs per car "are more or less similar" if you're making 20 or 60 cars.
Aston Martin finance chief Ken Gregor predicted the company's average selling price will rise past 200,000 pounds in the medium term.
"The building blocks to get there are additional derivates of the Aston Martin DBX, a refresh of the sports cars and the mid-engine car [Vanquish]," he told Automotive News Europe on the same call on Nov. 4.
Derivatives of the DBX include a six-cylinder mild-hybrid set to be launched this year, as well as an expected high-performance version of the V-8 model early next year. A plug-in hybrid version is due in 2023.
Aston Martin it also expects to start deliveries of the non-hybrid version of the delayed Valkyrie hypercar in the fourth quarter this year.
Also pushing up pricing will be the plug-in hybrid Vahalla hypercar due in 2023 and expected to cost between 600,000-700,000 pounds. The mid-engine sports car comes ahead of the mid-engine Vanquish, which will compete against the segment leading Ferrari F8.
Aston Martin's wholesale sales reached 4,250 cars in the first three quarters of the year, up from 1,555 last year when production was badly hit by the pandemic.