Aston Martin Releases Earnings Alert Due to US Tariff Pressures and Seeks Government Support
The automaker has blamed a profit warning to Donald Trump's tariffs, while simultaneously calling on the British authorities for greater proactive support.
The company, producing its cars in Warwickshire and south Wales, lowered its profit outlook on Monday, marking the second such revision in the current year. It now anticipates deeper losses than the previously projected £110m deficit.
Requesting Official Support
The carmaker voiced concerns with the British leadership, telling shareholders that despite having communicated with representatives from both the UK and US, it had productive talks with the American government but needed greater initiative from UK ministers.
It urged British authorities to protect the needs of small-volume manufacturers like Aston Martin, which provide thousands of jobs and add value to local economies and the broader UK automotive supply chain.
Global Trade Impact
The US President has shaken the global economy with a trade war this year, significantly affecting the car sector through the introduction of a 25 percent duty on 3rd April, on top of an existing 2.5 percent charge.
In May, the US president and Keir Starmer reached a agreement to limit tariffs on 100,000 UK-built cars per year to 10%. This tariff level took effect on June 30, coinciding with the last day of Aston Martin's Q2.
Agreement Criticism
However, the manufacturer criticised the bilateral agreement, arguing that the introduction of a US tariff quota mechanism adds further complexity and limits the company's ability to accurately forecast earnings for the current fiscal year-end and possibly each quarter starting in 2026.
Other Factors
Aston Martin also cited reduced sales partly due to increased potential for logistical challenges, especially following a recent digital attack at a major UK automotive manufacturer.
UK automotive sector has been shaken this year by a digital breach on the country's largest automotive employer, which led to a production freeze.
Financial Reaction
Stock in Aston Martin, traded on the London Stock Exchange, fell by more than 11% as trading opened on Monday morning before recovering some ground to be 7 percent lower.
Aston Martin sold one thousand four hundred thirty cars in its third quarter, missing previous guidance of being broadly similar to the 1,641 vehicles delivered in the equivalent quarter the previous year.
Upcoming Plans
The wobble in sales comes as the manufacturer prepares to launch its flagship hypercar, a mid-engine supercar costing around $1 million, which it expects will increase earnings. Shipments of the car are scheduled to begin in the last quarter of its financial year, although a projection of about 150 units in those final quarter was below previous expectations, reflecting engineering delays.
Aston Martin, famous for its appearances in James Bond films, has started a review of its upcoming expenditure and investment strategy, which it said would probably result in lower spending in engineering and development versus previous guidance of about £2bn between its 2025 and 2029 fiscal years.
The company also told investors that it does not anticipate to achieve positive free cash flow for the second half of its present fiscal year.
The government was approached for a statement.