🔗 Share this article

Aston Martin has blamed a profit warning to Donald Trump's tariffs, as it calling on the British authorities for greater proactive support.

This manufacturer, which builds its cars in Warwickshire and south Wales, lowered its profit outlook on Monday, marking the second such revision in the current year. It now anticipates a larger loss than the previously projected £110m deficit.

Seeking Government Backing

Aston Martin voiced concerns with the British leadership, informing investors that while it has communicated with representatives on both sides, it had positive discussions with the American government but required greater initiative from British officials.

It urged UK officials to safeguard the needs of small-volume manufacturers like Aston Martin, which provide numerous employment opportunities and contribute to regional finances and the wider British car industry network.

International Commerce Impact

Trump has shaken the global economy with a trade war this year, heavily impacting the automotive industry through the introduction of a 25% tariff on 3rd April, in addition to an existing 2.5% levy.

In May, the US president and Keir Starmer reached a deal to cap duties on 100,000 UK-built vehicles per year to 10 percent. This rate took effect on June 30, aligning with the final day of the company's Q2.

Agreement Criticism

However, Aston Martin expressed reservations about the trade deal, arguing that the implementation of a US tariff quota mechanism adds further complexity and limits the company's capacity to precisely predict financial performance for this financial year end and possibly quarterly from 2026 onwards.

Other Challenges

Aston Martin also cited weaker demand partly due to greater likelihood for supply chain pressures, particularly following a recent digital attack at a major UK automotive manufacturer.

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

Financial Response

Stock in Aston Martin, listed on the LSE, fell by over 11 percent as trading opened on Monday at the start of the week before recovering some ground to stand down 7%.

The group delivered 1,430 cars in its Q3, falling short of previous guidance of being roughly equal to the 1,641 cars delivered in the same period last year.

Future Plans

The wobble in sales comes as Aston Martin prepares to launch its Valhalla, a rear-engine hypercar priced at around £743,000, which it expects will boost earnings. Shipments of the car are expected to start in the last quarter of its fiscal year, though a projection of approximately one hundred fifty units in those three months was lower than previous expectations, due to engineering delays.

The brand, famous for its roles in James Bond films, has started a evaluation of its future cost and spending plans, which it said would probably result in reduced capital investment in R&D compared with previous guidance of about £2bn between its 2025 to 2029 fiscal years.

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

The government was approached for a statement.