🔗 Share this article

Aston Martin has attributed a profit warning to US-imposed trade duties, while simultaneously urging the UK government for greater active assistance.

The company, producing its cars in factories across England and Wales, lowered its earnings forecast on Monday, marking the second such revision this year. The firm expects a larger loss than the previously projected £110 million deficit.

Seeking Official Support

Aston Martin voiced concerns with the British leadership, informing investors that despite having engaged with officials on both sides, it had positive discussions with the US administration but needed greater initiative from British officials.

The company called on UK officials to protect the needs of niche automakers such as itself, which create numerous employment opportunities and add value to regional finances and the broader UK automotive supply chain.

International Commerce Impact

Trump has disrupted the global economy with a trade war this year, heavily impacting the car sector through the imposition of a 25 percent duty on 3rd April, in addition to an previous 2.5 percent charge.

In May, American and British leaders reached a agreement to limit duties on 100,000 UK-built cars per year to 10 percent. This rate took effect on 30th June, coinciding with the final day of Aston Martin's Q2.

Trade Deal Criticism

However, Aston Martin expressed reservations about the trade deal, stating that the introduction of a US tariff quota mechanism adds further complexity and limits the company's capacity to precisely predict financial performance for the current fiscal year-end and possibly each quarter starting in 2026.

Other Challenges

The carmaker also pointed to weaker demand partially because of increased potential for logistical challenges, especially following a recent cyber incident at a leading British car producer.

UK automotive sector has been rattled this year by a digital breach on the country's largest automotive employer, which prompted a manufacturing halt.

Market Response

Stock in the company, traded on the London Stock Exchange, dropped by over 11 percent as markets opened on Monday morning before recovering some ground to be down 7%.

The group delivered one thousand four hundred thirty cars in its Q3, missing previous guidance of being roughly equal to the one thousand six hundred forty-one cars delivered in the same period the previous year.

Future Plans

The wobble in demand coincides with the manufacturer gears up to release its Valhalla, a rear-engine supercar costing approximately $1 million, which it hopes will increase earnings. Shipments of the vehicle are expected to start in the last quarter of its fiscal year, though a forecast of about 150 units in those final quarter was below previous expectations, due to engineering delays.

The brand, famous for its appearances in the 007 movie series, has started a review of its upcoming expenditure and spending plans, which it said would probably lead to reduced capital investment in engineering and development compared with earlier forecasts of approximately £2 billion between its 2025 and 2029 fiscal years.

Aston Martin also informed shareholders that it no longer expects to generate profitable cash generation for the latter six months of its present fiscal year.

The government was contacted for a statement.