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Aston Martin shares leap as CEO replaced with Mercedes chief

Oscar Williams-Grut
·Senior City Correspondent, Yahoo Finance UK
·3-min read
GAYDON, ENGLAND - JANUARY 10:  An Aston Martin Vanquish is inspected by hand inside a light booth at the company headquarters and production plant on January 10, 2013 in Gaydon, England. The iconic British brand is celebrating its 100th anniversary. Lionel Martin and Robert Bamford created Bamford & Martin on January 15 1913, which later became Aston Martin in honour of Bamford’s wins at the Aston Clinton Hillclimb in Buckinghamshire.  (Photo by Christopher Furlong/Getty Images)
Aston Martin has confirmed Andy Palmer is to step down as chief executive. (Christopher Furlong/Getty Images)

The board of struggling Aston Martin (AML.L) has confirmed the exit of chief executive Andy Palmer, following a dreadful run for the luxury carmaker on the public markets.

Aston Martin said in a statement on Tuesday that Palmer had agreed to step down as president and group chief executive after discussions with the board.

Mercedes-AMG chief executive Tobias Moers will replace him, taking up the role on 1 August. Aston Martin’s manufacturing chief Keith Stanton and executive chairman Lawrence Stroll will take charge of operations in the meantime.

News that Aston Martin was considering getting rid of Palmer first broke over the weekend. Palmer told the press he was not aware of these plans.

READ MORE: Aston Martin chief Andy Palmer reported to leave luxury car giant

Palmer has run James Bond’s car maker since 2014 but has struggled since the company went public in 2018. Shares have fallen over 90% since listing and the company made a loss of £100m ($123m) last year. The company was forced to raise £500m in a rescue deal in January.

Tobias Moers, Chairman of the Management Board, Mercedes-AMG speaks at the North American International Auto Show in Detroit, Monday, Jan. 9, 2017. (AP Photo/Paul Sancya)
Mercedes-AMG chief executive Tobias Moers is to take up the chief executive role at Aston Marton. (Paul Sancya/AP Photo)

Chairman Stroll said on Tuesday: “The Board has determined that now is the time for new leadership to deliver our plans.”

Canadian F1 billionaire Stroll joined Aston Martin at the start of the year after investing £200m as part of the rescue deal.

He thanked Palmer and said he was “delighted to welcome Tobias to Aston Martin Lagonda”.

READ MORE: Aston Martin rescue deal agreed as F1 billionaire buys stake

“He is an exceptionally talented automotive professional and a proven business leader with a strong track record during his many years at Daimler AG,” Stroll said. “He is the right leader for Aston Martin Lagonda as we implement our strategy for the business to achieve its full potential.”

Mercedes-AMG, where Moers currently works, is the high performance subsidiary of Germany car giant Daimler AG (DAI.DE). Daimler has a 5% stake in Aston Martin and supplies the carmaker with Mercedes-AMG engines.

Read more: Aston Martin to 'reset' business after losing £104m in a year

Shares in Aston Martin jumped over 30% on confirmation of Moers’ appointment.

Aston Martin shares jumped after the leadership change was announced. Photo: Yahoo Finance UK
Aston Martin shares jumped after the leadership change was announced. (Yahoo Finance UK)

Moers said he was “excited” to join the company and saw “significant opportunity to harness the strengths of the business to successfully deliver the planned product expansion and brand elevation”.

Palmer said in a statement: “It has been a privilege to serve Aston Martin Lagonda for almost six years. The launch of many new products including the new DBX demonstrates the dedication and capability of our employees.

“I would like to thank my management team and all the staff for their hard work and support, particularly during the challenges presented by COVID-19. I am proud of you all and it's been an honour to work with you.”