Aston Martin set to trade sideways as Lawrence Stroll overhaul continues
The luxury car maker is likely to see its share price trade sideways as the company’s overhaul under its new billionaire chairman Lawrence Stroll continues.
Aston Martin Lagonda is likely to see its share price trade sideways over the near-term as the company’s overhaul under its new billionaire chairman Lawrence Stroll continues.
This week, the luxury car maker appointed Ken Gregor as its new chief financial officer, with Stroll labelling him a ‘seasoned financial professional’ boasting a ‘strong leadership track record’ during his time at Jaguar Land Rover.
‘He is the right finance leader for Aston Martin as we implement our strategy for the business to achieve its full potential,’ Stroll added.
It has been a rocky start to the year for Aston Martin, with the company’s stock falling more than 80% to hit a low of 30p per share in mid-May. Since then the stock has rebounded somewhat, with trading action in and around the 65p to 75p range throughout June.
Aston Martin closed at 70p a share on Monday, with the stock down 59% year-to-date .
Aston Martin to cut 500 jobs amid struggling sales
Earlier this month, the luxury car maker said it plans to axe around 500 jobs after it was forced to cut back on production due to disappointing sales figures as a result of the coronavirus pandemic hurting demand.
‘Aston Martin continues to take decisive action in other areas to reduce cost and remove non-critical expenditure from the business at every level including in areas such as contractor numbers, site footprint, marketing and travel costs,’ the company said in a statement.
‘The measures announced today will right-size the organisational structure and bring the cost base into line with reduced sports car production levels, consistent with restoring profitability,’ Aston Martin said.
Covid-19 puts added pressure on ailing Aston Martin
Aston Martin was already struggling before the Covid-19 crisis began, but the outbreak put an even larger dent in the company’s global sales figures, with it selling only 578 cars to dealers in Q1.
‘Covid-19 and the resulting global economic shutdown has had a material impact on our performance this quarter but during this unprecedented time we completed a £536 million capital raise and continued to implement our exciting strategy to reset and safeguard the long-term future of the business,’ Aston Martin Lagonda president and CEO Andy Palmer said.
‘Part of the reset includes reducing our global dealer inventory to a luxury norm to rebalance supply and demand, to build resilience and profitability for the future,’ he added.
‘Although there is still much uncertainty around the duration of the pandemic and the shape of the economic recovery, we remain focused on and excited about our plans.’
On 5 May, the company reopened its St Athan manufacturing facility, which has begun production of DBX bodies and remains on course to start full production in the weeks ahead, with deliveries starting in the summer.
Aston Martin reassured investors that its order book continues to build and extend into 2021, with particular interest paid to its newly launched Vantage Roadster.
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