Aston Martin’s CEO has warned investors of a sharp fall in annual profits, as the luxury British car retailer faced challenging trading conditions in the last few months of 2019.
Despite a growth of 12% in core retail sales, wholesale volumes of cars fell by 7% – with Europe being one of the poorest performing regions.
Shares fell more than 10% following the announcement.
The company also revealed that it has spent more on marketing and aiding customers finance purchases.
Dr Andy Palmer, Aston Martin Lagonda President and Group CEO, said: “From a trading perspective, 2019 has been a very disappointing year. Whilst retails have grown by 12%, our best result since 2007, our underlying performance will fail to deliver the profits we planned, despite a reduction in dealer stock levels.
“We are taking a series of actions to manage the business through this difficult period. 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.
“The signs from the launch of the DBX are very encouraging and the order rate seen to date is materially better than for any of our previous models. Launch plans are progressing well and we are achieving all of our key operational milestones. Start of production remains on track for Q2 2020.
“Whilst we are disappointed with trading performance in 2019, our focus is now on revitalising the business, launching DBX and ensuring profitable growth in the medium-term.”