The Luxury Carmaker Releases Profit Warning Amid American Trade Challenges and Requests Official Assistance

Aston Martin has blamed an earnings downgrade to US-imposed tariffs, while simultaneously calling on the UK government for more proactive support.

This manufacturer, producing its cars in Warwickshire and south Wales, revised its earnings forecast on Monday, marking the second such revision in the current year. The firm expects deeper losses than the previously projected £110 million shortfall.

Seeking Official Support

Aston Martin expressed frustration with the British leadership, telling investors that while it has communicated with representatives on both sides, it had positive discussions directly with the American government but needed more proactive support from UK ministers.

It urged British authorities to protect the needs of niche automakers such as itself, which provide numerous employment opportunities and contribute to local economies and the broader UK automotive supply chain.

International Commerce Effects

Trump has disrupted the worldwide markets with a tariff conflict this year, significantly affecting the automotive industry through the introduction of a 25% tariff on April 3, on top of an existing 2.5% levy.

During May, the US president and Keir Starmer reached a deal to limit tariffs on one hundred thousand UK-built cars per year to 10 percent. This rate took effect on June 30, coinciding with the final day of the company's Q2.

Trade Deal Criticism

However, Aston Martin expressed reservations about the trade deal, stating that the implementation of a American duty quota system introduces additional complications and restricts the group's ability to precisely predict earnings for this financial year end and potentially each quarter starting in 2026.

Additional Factors

Aston Martin also pointed to reduced sales partially because of greater likelihood for logistical challenges, especially following a recent digital attack at a leading British car producer.

UK automotive sector has been shaken this year by a cyber-attack on Jaguar Land Rover, which led to a production freeze.

Market Reaction

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

Aston Martin sold 1,430 cars in its third quarter, missing previous guidance of being broadly similar to the 1,641 cars delivered in the same period last year.

Upcoming Initiatives

Decline in demand comes as Aston Martin prepares to launch its flagship hypercar, a mid-engine hypercar priced at around $1 million, which it expects will increase earnings. Shipments of the car are expected to begin in the last quarter of its fiscal year, although a forecast of about 150 deliveries in those final quarter was below earlier estimates, reflecting technical setbacks.

Aston Martin, well-known for its appearances in the 007 movie series, has initiated a evaluation of its upcoming expenditure and spending plans, which it said would likely result in lower spending in R&D versus previous guidance of approximately £2 billion between its 2025 to 2029 fiscal years.

Aston Martin also informed shareholders that it does not anticipate to generate positive free cash flow for the second half of its current year.

The government was contacted for a statement.