LONDON: Aston Martin Lagonda Global Holdings Plc will almost double production this year after working through inventory issues that have plagued the luxury-car maker since its 2018 initial public offering.
The British manufacturer plans to make 6,000 vehicles this year, up from just 3,394 in 2020, according to a statement today. Aston Martin’s quarterly revenue and adjusted earnings beat estimates on strong demand for its DBX sport utility vehicle. The shares rose as much as 9.5%.
Roaring back
Aston Martin spent last year restructuring itself after a rescue by Canadian billionaire Lawrence Stroll. The 61-year-old fashion mogul has injected much-needed cash and forged closer ties with Daimler AG’s Mercedes-Benz to ensure the company survives tumultuous times for the auto industry.
After not having turned a profit since it went public in 2018, Stroll has set targets for Aston to earn £500 million (RM2.8bil) on £2 billion of revenue by 2025. Stroll also has returned the company to Formula 1 racing.
Aston recorded a £70.1 million adjusted loss before interest, taxes, depreciation, and amortisation for last year, though earnings on that basis were positive in the fourth quarter. Revenue in the last three months of the year rose 3.4% to £341.8 million.
SUV expansion
Aston plans to expand its portfolio of SUVs over the next two years, chief executive officer Tobias Moers said in an interview.
The company will begin to see the fruits of its partnership with Mercedes-Benz in the third quarter, the former head of AMG said.
In October, Aston reached an agreement for Mercedes to supply hybrid and electric powertrains to the UK company, building on an engine tie-up that started in 2013. In exchange, Aston will issue new shares to Mercedes, which will boost its stake from 2.6% to as much as 20% over three years.
The carmaker is counting on sales of the DBX to pace its recovery. Deliveries of the model began last year in the midst of the Covid-19 pandemic and ensuing lockdowns.
The carmaker also will begin shipping its Valkyrie hypercar in the second half of 2021 as planned.
Aston plans to refresh its entire portfolio of cars and introduce electric and plug-in hybrids, Moers said. The DBX, which accounted for almost two-thirds of production in the fourth quarter, has orders booked through the summer and is seeing strong demand in China.
In a significant change in strategy, the carmaker will introduce electric variants for all its launches from 2024, according to an investor presentation.
Aston doesn’t plan on investing in battery production, which Moers said is a “far too intense” capital expenditure for the company to make.
