The Luxury Carmaker Announces Profit Warning Due to American Trade Challenges and Seeks Official Support
The automaker has attributed a profit warning to US-imposed trade duties, as it urging the British authorities for greater proactive support.
This manufacturer, producing its vehicles in factories across England and Wales, revised its earnings forecast on Monday, representing the second such revision this year. The firm expects a larger loss than the previously projected £110 million deficit.
Requesting Official Support
The carmaker expressed frustration with the British leadership, telling shareholders that despite having engaged with representatives on both sides, it had productive talks directly with the American government but needed greater initiative from UK ministers.
It urged UK officials to protect the needs of small-volume manufacturers such as itself, which provide thousands of jobs and add value to regional finances and the broader UK automotive supply chain.
Global Trade Effects
Trump has shaken the worldwide markets with a tariff conflict this year, heavily impacting the automotive industry through the introduction of a 25 percent duty on April 3, on top of an previous 2.5% levy.
During May, American and British leaders agreed to a agreement to limit tariffs on 100,000 British-made vehicles per year to 10 percent. This rate came into force on 30th June, coinciding with the final day of Aston Martin's second financial quarter.
Agreement Criticism
Nonetheless, the manufacturer criticised the trade deal, arguing that the introduction of a US tariff quota mechanism adds further complexity and restricts the group's capacity to precisely predict earnings for this financial year end and potentially each quarter starting in 2026.
Additional Factors
Aston Martin also pointed to reduced sales partly due to greater likelihood for supply chain pressures, particularly after a recent cyber incident at a leading British car producer.
The British car industry has been shaken this year by a cyber-attack on Jaguar Land Rover, which led to a production freeze.
Market Reaction
Stock in the company, listed on the LSE, dropped by more than 11% as markets opened on Monday morning before partially rebounding to stand 7 percent lower.
The group delivered 1,430 vehicles in its Q3, missing previous guidance of being broadly similar to the one thousand six hundred forty-one cars delivered in the same period last year.
Upcoming Plans
The wobble in demand comes as the manufacturer prepares to launch its Valhalla, a mid-engine supercar priced at around $1 million, which it expects will boost profits. Deliveries of the vehicle are scheduled to begin in the last quarter of its fiscal year, though a forecast of approximately one hundred fifty deliveries in those final quarter was below earlier estimates, due to technical setbacks.
Aston Martin, famous for its roles in the 007 movie series, has started a review of its future cost and spending plans, which it said would likely lead to reduced capital investment in engineering and development versus earlier forecasts of approximately £2 billion between its 2025 to 2029 fiscal years.
Aston Martin also informed shareholders that it does not anticipate to achieve positive free cash flow for the latter six months of its present fiscal year.
UK authorities was contacted for a statement.