Aston Martin on Wednesday became the latest car industry player to report a hit to its business from a shaky European economic mood, cutting its 2019 volumes forecast after sales in the region fell by almost a fifth in the first half.
The report, which also saw the luxury British car maker slash up to £40 million (Dh227.6m) off its previous investment plans, sent its shares spinning 23 per cent lower in early trade in London.
The European car sector is struggling with a worsening economic mood as well as concerns over the potential fallout for demand and manufacturing of Britain's exit from the European Union.
German peer Daimler said on Wednesday it would intensify cost cuts after legal risks for diesel-related issues and the cost of replacing Takata airbags triggered a steep quarterly pretax loss.
Aston Martin said in May that some of its markets faced a "challenging environment", and that it was planning accordingly to avoid problems with deliveries.
Wednesday's numbers showed wholesale sales volumes in Europe, Middle East and Africa fell 19 per cent year-on-year in the first half, while those in the UK dropped 17 per cent.
"The challenging external environment highlighted in May has worsened, as have macro-economic uncertainties," the company said. "We anticipate that this softness will continue for the remainder of the year and are planning prudently for 2020."
While the European numbers were poor, US and Asian sales of the company's cars - made famous by James Bond - continue to surge. First-half sales in the Americas rose 54 per cent to make it Aston Martin's single biggest market.
However shares of the company, which listed on the London Stock Exchange in October last year, had tanked 20.8 per cent to 819.6 pence by 07.16 GMT, putting it at the bottom of the FTSE mid-cap index.
Including Wednesday's losses, shares have tumbled 58 per cent from their initial public offering (IPO) price of 1,900 pence.
The company, which has seen costs rise due to aggressive investment and Brexit provisions, said it now expects annual wholesale volumes to be between 6,300 to 6,500 vehicles, compared with an earlier forecast of 7,100 to 7,300 vehicles.
It also lowered its forecast for its adjusted earnings before interest, tax, depreciation and amortisation margin and said it would cut capital expenditure to about £300m from £320m to £340m expected earlier.
"We are disappointed that short-term wholesales have fallen short of our original expectations," said chief executive Andy Palmer said. "We are today taking decisive action to manage inventory and the Aston Martin Lagonda brands for the long-term."
Half-year results are due next week.
