Aston Martin posts further losses but insists turnaround on track

Luxury carmaker Aston Martin Lagonda has laid bare the scale of its challenge to turn around its fortunes as it recorded worse-than-expected losses.

The group saw pre-tax losses widen to £88.7 million in its second quarter from £61.2 million a year ago, leaving it slumping in the red by £154.2 million overall in the first half.

Underlying operating losses narrowed to £52 million in the second quarter from £57 million a year ago, but this was still worse than forecast.

Aarin Chiekrie, equity analyst at Hargreaves Lansdown, said: “Aston Martin’s first-half results showed its luxury cars are gaining traction, but its finances remain stuck in the slow lane.

“A ramp-up in production of its higher-priced special models, such as the Valhalla, drove revenues higher at double-digit rates.

“But that’s just part of the story. Costs continue to race higher too, especially financing costs on its mounting debt pile, and pre-tax losses widened over the period.

“Ignoring these financing costs, the group expects underlying operating profitability to move towards breakeven by the end of the year.

“But Aston Martin has developed a bit of a reputation for overpromising and underdelivering in recent times. As a result, we remain sceptical that the carmaker can get its financial performance back on track within management’s timeline.

“The broader backdrop for the auto industry remains challenging too. While Aston Martin has managed the direct impact of the Middle East conflict well so far, a prolonged period of elevated oil prices could lead to higher costs as supply chains come under pressure.

“The US tariff system also adds uncertainty to its ability to accurately forecast financial performance, requiring careful management of deliveries towards the end of each quarter to avoid much higher tariff rates.

“Given the lack of control and the fact that more than a third of Aston Martin’s cars are sold in the US, it remains a difficult challenge to manage.”