The British luxury carmaker Aston Martin is planning to shed around 500 jobs as the company looks forward to bring the cost base into a line with reduced production levels of sports cars, it stated on Thursday.
The job cuts are coming after a week of Aston Martin confirming that Tobias Moers, who is the CEO of Mercedes-AMG, will be joining as the chief executive from August 1 by replacing Andy Palmer.
Aston Martin to Cut Jobs
The 107-year old firm said the job losses reflected lower than originally planned production volumes and improved productivity across the business. An employee and trade union consultation process will be launched in the coming days. Aston Martin, famed for being fictional secret agent James Bond's car of choice, has seen its share price plummet since floating in October 2018.
Last month it posted a deep first-quarter loss after sales dropped by almost a third due to the impact of the novel coronavirus outbreak. "The measures announced today will right-size the organizational structure and bring the cost base into line with reduced sports car production levels, consistent with restoring profitability," it said.
It said its first sports utility vehicle (SUV), the DBX, which is key to boost volumes and appeal to new buyers including more women, remains on track for deliveries in the summer and has a strong order book. Aston Martin is also reducing costs and removing non-critical expenditure in other areas, including contractor numbers, site footprint, marketing and travel.
It said the restructuring is expected to deliver total annual savings of about 38 million pounds ($47.6 million). Restructuring costs are expected to be about 12 million pounds. Shares in Aston Martin, down 78 percent over the last year, closed Wednesday at 68.9 pence, valuing the business at 1.05 billion pounds.
(With agency inputs)