Yahoo Finance Aston Martin’s losses soar as COVID-19 causes sales plunge
Luxury British carmaker Aston Martin Lagonda (AML.L) reported a first-half operating loss £159.3m ($206m) on Wednesday, more than four times the £38.9m operating loss it posted for the same period in 2019 — as the company increased spending for its SUV launch and weathered coronavirus lockdowns.
Sales in the first half of this year plunged by 41%, with the biggest sales drop, 48%, in the last quarter, as coronavirus lockdowns forced dealerships and plants to close.
“It has been a challenging period with our dealers and factories closed due to COVID-19, in addition to aligning our sales with inventory with the associated impact on financial performance as we reposition for future success,” Aston Martin executive chairman Lawrence Stroll said in a statement.
Stroll added that the company has raised £688m of new equity from his consortium and other investors to strengthen the balance sheet and improve liquidity.
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Aston Martin is banking on its first SUV, the DBX, to help it revive its fortunes. The luxury SUV started rolling off the production lines at the new plant in St. Athan, Wales earlier this month, and the first deliveries have been made. The company said that interest in the DBX from the Chinese market is positive.
Aston Martin has had a turbulent couple of years since going public in 2018. It made a loss of £100m in 2019, then was forced to raise £500m in a rescue deal at the beginning of this year via an investment led by Stroll, a Canadian Formula 1 billionaire.
A few months later, in May, Aston replaced CEO and president Andy Palmer with Mercedes-AMG chief executive Tobias Moers, who starts in August. Palmer had been with the company since 2014.
