Trade war: Aston Martin outlines plan to beat US tariff hit as profits sink
Aston Martin Lagonda has revealed a plan to bring forward production at the beginning of next year as it looks to swerve a worse hit from US trade tariffs.
The UK luxury carmaker said it was lobbying the UK government to improve the terms of its trade deal with Donald Trump.
The company explained that, as things stand, it would have to ship more cars earlier than planned next year if it was to ease the threat to its sales and bottom line posed by the quota element of the agreement.
Auto manufacturers had initially faced down a tariff above 25% from April.
Since 30 June, that US import duty rate fell to 10% but it only applies to the first 100,000 UK-made cars which enter the US on an annual basis.
Aston said on Wednesday that the tariff chaos, coupled with weaker demand in China, meant adjusted operating profits for the year would roughly break even.
2:49
It had previously forecast a positive result.
The company, best-known for its models' starring role in the majority of James Bond movies, issued the annual profit warning followed a temporary halt to US exports amid the tariff chaos.
It resumed shipments last month.
The United States and China account for its top two export markets.
It has not been alone in issuing a warning to investors over the anticipated pressures on sales.
Aston Martin boss Adrian Hallmark described demand in China, where consumers are feeling the pinch, as "stagnant" in a call with analysts.
"The evolving and disruptive US tariff situation was unhelpful to our operations in Q2," he said.
Aston said it was reviewing its supply chain to reduce possible negative impacts such as disruption to demand and distribution.
It reported a 25% plunge in revenue to £454.4m in the six months to 30 June compared to the same period last year.
Its core profit measure was in the red to the tune of £121.5m. That was 22% up on a £99.8m loss.
Mr Hallmark said the financial performance also reflected fewer planned deliveries of its Specials models.
The company is preparing for the first customer deliveries of Valhalla, its first mid-engine plug-in hybrid electric supercar.
That is expected in the final quarter of the year.
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