Aston Martin shares slide 15% as it struggles to source car parts – The Guardian

November 2, 2022 by No Comments

Aston Martin shares slid after the company revealed it would deliver fewer cars than expected this year as it struggled to source certain parts due to supply chain problems.

The luxury sports carmaker had expected to sell 6,600 cars this year but said it may sell as few as 6,200. It said the parts shortages meant more than 400 vehicles were awaiting final parts at the end of September, which are expected to be delivered in the fourth quarter.

Aston Martin’s shares fell by almost 15% in London on Wednesday, making it the biggest faller on the FTSE 250 index. The stock price is down about 81% this year.

The carmaker also reported a cut in sales and profit forecasts for the year, after it bought back $185m (£161m) of its debt in order to cut interest payments. The company said pre-tax losses for the quarter to September more than doubled to £225.9m, compared with £97.9m over the same period last year.

The debt buyback was raised through a recent £654m funding deal that took place in September by selling discounted shares to existing shareholders and bringing in new investors, including Saudi Arabia’s sovereign wealth fund and Chinese carmaker Geely.

The carmaker’s executive chair, Lawrence Stroll, said volatility and uncertainty in the supply chain had led to disruption in its production aims by pushing the planned deliveries of the vehicles towards and beyond the end of the latest quarter.

Stroll said this was compounded by delays to outbound logistics to North America due to Hurricane Ian, but maintained that the situation was “already improving”.

“Our core [average selling price] is up 28% year on year to new record levels. This is a meaningful trend and is underpinned by our approach to being demand led,” Stroll said.

The company said profit margins for the year are also set to be lower than previous guidance as the result of the weakened pound against the dollar. However, Stroll said margins would increase by up to 300 basis points during the year.

He added: “On a year to date basis, we have seen more than 300 basis points of gross margin expansion as we continue on our journey towards our medium-term targets of 40%-plus.

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Source: https://news.google.com/__i/rss/rd/articles/CBMicWh0dHBzOi8vd3d3LnRoZWd1YXJkaWFuLmNvbS9idXNpbmVzcy8yMDIyL25vdi8wMi9hc3Rvbi1tYXJ0aW4tc2hhcmVzLXNsaWRlLTE1LWFzLWl0LXN0cnVnZ2xlcy10by1zb3VyY2UtY2FyLXBhcnRz0gEA?oc=5

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