Aston Martin is cutting 5% of its workforce, amounting to 170 job losses, as part of a cost-cutting plan to stabilize its finances. The luxury car manufacturer reported a 21% increase in pre-tax losses, reaching £289 million, while its debt surged by 43% to £1.16 billion in the past year. The company aims to save £25 million annually, with half of that expected to be achieved this year.
In addition to the job cuts, Aston Martin has also confirmed a delay in its first fully electric vehicle, which was initially planned for 2026. The new model is now expected closer to the end of the decade, as the company takes a phased approach to electrification.
Why Is Aston Martin Cutting Jobs?
According to The Sun, Aston Martin’s financial troubles stem from a drop in sales, rising production costs, and supply chain issues. Despite an improvement in wholesale volumes in the second half of 2024, the company still saw an overall 9% decline in sales, delivering 6,030 cars over the year.
The company said the job cuts are a “difficult but necessary action”, affecting roles across manufacturing, office jobs, and management. Most layoffs are expected to take place in the UK, where Aston Martin has its headquarters in Gaydon, Warwickshire, and a factory in St Athan, South Wales.
Electric Car Plans Put on Hold
Aston Martin has decided to push back the launch of its first all-electric vehicle as part of a longer-term strategy. The model was originally planned for 2026, but it will now be introduced closer to 2030. The company cited a “phased approach to electrification”, suggesting a more cautious transition into the EV market.
The delay contrasts with other luxury car brands, such as Ferrari and Bentley, which are moving forward with their electrification strategies. However, Aston Martin has been focused on new model launches, including the Vantage, DBX707, and Vanquish, to improve short-term sales and boost production numbers.
Debt, Sales Struggles, and Future Outlook
Despite high-profile product launches, Aston Martin has struggled with supply chain disruptions and weak demand in key markets like China. In September 2024, the company warned that production would be reduced by 1,000 cars due to supply chain problems.
Newly appointed CEO Adrian Hallmark, who took over in September, acknowledged the challenges, stating:
“It has been a period of intense product launches, coupled with industry-wide and company challenges. We need to transition from a high-potential business to a high-performing one, better equipped to navigate future opportunities and uncertainties.”
Meanwhile, shares in Aston Martin have dropped 33% over the past year, reflecting investor concerns about its growing debt and financial instability.
