Aston Martin losing £1m a day as it misses all targets

Aston Martin Lagonda has confirmed that it remains stuck in second gear, with volumes and revenues still down on last year, its operations firmly in the red — burning through cash at more than £1 million a day — and net debt soaring again.
The only carmaker listed on the London Stock Exchange warned a month ago that all its targets for 2024 had been too ambitious and that its progress in the launch of four new or updated models had been hobbled by supply chain issues and crashed demand in China.
Soon after his arrival in September the former Bentley boss Adrian Hallmark, the company’s fifth chief executive in as many years, reset the carmaker’s goals, including cutting annual production from previous targets by 14 per cent to 6,000 vehicles. The admission that targets on margins, operating profits and cashflow would all be missed sent shares to a two-year low.
• Aston Martin shares hit skids after profits warning
Aston Martin is controlled by executive chairman Lawrence Stroll and a coterie of his friends alongside the Saudi Arabian sovereign wealth fund PIF and the Chinese carmaker Geely.
In morning trading on Wednesday, the shares were unmoved at 105p, valuing the company at £870 million. When Aston floated on the stock exchange six years ago with long since abandoned plans to become a powerhouse of electric luxury motoring, it was valued at £4.3 billion.
In the third quarter of the year, the group delivered 1,641 vehicles, 14 per cent more than in the same quarter last year, bringing in an 8 per cent increase in revenues to £391 million. Its losses for the quarter came in at £12 million against a £117 million deficit in July to September 2023.
The company is playing catch-up. For the first nine months of the year, volumes are down 17 per cent at 3,639 and revenues off 4 per cent at £994 million, and its pre-tax losses of £228 million are only marginally better than the £259 million in the same period last year.
However, with the company having abandoned its target of being cashflow break-even by the end of 2024, it revealed the extent of its miss, reporting that it burned through cash at a rate of about £1 million a day in the last quarter and more than £1.4 million a day in the year to date.
Those cash outflows of £393 million in the first nine months of the year, plus yet another debt refinancing by the company, left its net borrowings at £1.21 billion, up nearly 50 per cent from the £814 million a year ago, and about 1.4 times more than its equity value.
The latest figures also reveal a dramatic change in the group’s output after a collapse in demand for its hitherto best-selling vehicle, the 4×4 DBX, especially in its key target market of China, the biggest car marketplace in the world.
A year ago the DBX accounted for more than half of Aston Martin’s sales. That has been reduced to just 30 per cent. Volume sales of all vehicles to China were down 54 per cent.
Hallmark insisted that when the erratic automotive supply chain cleared itself up and markets became less volatile Aston Martin’s “most diverse, dynamic and desirable portfolio in the luxury [car] segment” would begin to fly.
He said: “We are on track to meet our revised full-year 2024 guidance which reflects the necessary action taken in September to adjust our production volumes, given supplier disruption which we are proactively managing and the weak macroeconomic environment in China.”