Aston Martin faces profit warning due to delivery delays

Aston Martin, a renowned UK luxury car manufacturer linked to the James Bond film franchise, has found itself in challenging financial waters as it issued a second profit warning within the span of two months. The company now forecasts a profit of up to £280 million ($352 million) for the year 2024, which is a decline from last year's reported profit of £305.9 million. The latest profit warning was attributed to a 'minor delay' in the delivery of the ultra-exclusive Valiant model cars, alongside a significant fall in demand for luxury vehicles, particularly in China due to a slowing economy. The announcement follows an earlier warning in September, where Aston Martin pointed to decreased demand in China affecting sales of high-end goods. This downturn has been exacerbated by issues with several suppliers that have impacted the production of various new models, leading to the decision to reduce total car production by about 1,000 units this year compared to the initial plan. To remedy its financial situation, Aston Martin stated it aims to raise £210 million through a combination of new shares and debt issuance. According to Adrian Hallmark, the company's Chief Executive, these financial measures are necessary to support growth and facilitate future product innovation. He emphasized that decisive actions are being taken to ensure a more balanced production and delivery outlook moving forward. This predicament is not just unique to Aston Martin; it reflects a broader trend where luxury car makers in Europe are facing similar pressures due to disappointing sales figures and increased competition from international markets. Since the beginning of the year, Aston Martin's UK-listed shares have halved, indicating a challenging road ahead as the company navigates these economic hurdles while attempting to stabilize and grow its brand presence in the highly competitive automotive industry.