New Aston Martin CEO Adrian Hallmark has made his first big impact on the company since joining on 1 September by reducing its ambitious sales forecast for 2024 by 1000 units.
Aston Martin cited supply chain disruption, weak demand in China and excess stock in dealers for the downgrade. It also said it would no longer be cashflow-positive (a measure of profitability) in the second half of the year, another change in guidance.
As recently as 28 July, the British company forecast a dramatic rise in wholesales (sales to dealers) for the second half of 2024, fuelled by a quick ramp-up of production of the new DB12, Vantage, new Vanquish and recently overhauled DBX SUV.
The promised “high single-digit-percentage growth” in wholesales this year from the 2023 total of 6620 would have meant sales climbing past 7000 for the first time since 2007 – the only year in which Aston Martin has cleared that hurdle.
However, Aston Martin, under the new leadership of former Bentley boss Hallmark, has now lowered that sales forecast to what effectively will be just over 6000 – back to 2021 levels and below last year’s figure of 6620 (the highest for 10 years).
Hallmark said the original production and sales plan, formulated before he arrived, would have required “near-perfect execution”.
The previous plan to replace sales lost in the first half due to the model changeover had been criticised as overly ambitious by some industry observers. “The wholesale growth target looks like a major stretch,” opined specialist luxury car business publication SSO Report on the company’s first half results.
Aston Martin had struggled to ramp up production of the DB12 last year, due to software integration problems, and is now facing serious supplier issues, according to Hallmark.
It previously said it was only building the DB12 in the first half of this year as it cleared the decks for the new models.
Aston Martin didn’t single out any supplier, but Hallmark referenced the shortage of automotive-grade aluminium following summer floods in Switzerland that has hit both JLR and Porsche. Aston Martin was also a customer of the now-insolvent Recaro, the seat supplier said.
Currently a “double-digit percentage” of cars rolling off Aston Martin’s production lines in St Athan and Gaydon are lacking parts that need to be fitted at a later date, Hallmark told analysts on a call today. “It's not lost production, but we cannot cope with the volumes of rework at any given point in time,” he said.
The new CEO said that he had costed the accelerated production schedule for the new models along with the attendant logistics and found it “significant”.
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