Sports car maker Aston Martin expects to turn cash-flow positive this year thanks to a string of new model launches and marketing boost from Formula One, said chairman of the board Lawrence Stroll.
“We’re in a period of transition, we’re at a tipping point,” Stroll told CNBC. “We’re finally going to introduce all the products that we’ve been working on designing and building for the last four years since I took over. Going forward, we’re going to maintain our normal quarterly production volumes, with a more traditional quarterly flow of new cars, not the hockey stick model that we’ve had in the past.”
Stroll said the company, which has been losing money for years, had turned cash flow positive in the third quarter and expected that to continue in the fourth quarter and beyond.
It would mark a dramatic shift for the storied British carmaker, famous both for its role in the James Bond films and its history of financial ups and downs. Stroll, a billionaire and former fashion mogul who became Aston Martin’s board chairman in 2020, has laid out a sweeping plan to restore luster and profits to the brand.
Aston Martin has overhauled and improved its manufacturing, strengthened its finances to invest in the future and is now launching a range of new products featuring high performance and luxury finishes.
Aston Martin F1 Team owner Lawrence Stroll (right) shakes hands with Ferrari team principal Frederic Vasseur on the grid before the 2024 Miami Grand Prix at Miami International Autodrome in Miami, Florida on May 5, 2024.
Chris Greisen | Getty Images
Still, production fell, first-quarter pretax losses doubled from a year ago and the company’s shares slumped to their lowest level since 2022. Stroll said the drop in production and the expected decline in the second quarter were part of a deliberate plan to phase out older models and make room to ramp up production of new ones in the coming months.
“We made a conscious decision to stop production of certain vehicle models,” he said. “We reduced our production and wholesale volumes to avoid a buildup of old vehicles in our dealer network while still releasing all new vehicles.”
The new vehicles include the new Vantage, a front-engine, rear-wheel-drive sports car with 656 horsepower and a starting price of $191,000.
The company also unveiled the new DBX707, a high-performance SUV that can accelerate from 0 to 60 mph in 3.1 seconds and has a top speed of 200 mph. The company also unveiled the DB12 Volante, an open-top version of the DB12.
Aston Martin has teased a new ultra-high-output V-12 engine that will be called the Vanquish later this year.
The company also plans to start deliveries of an $800,000 hybrid supercar called Valhalla later this year or early 2025.
the $800,000 Aston Martin Hybrid Valhalla;
Courtesy: Aston Martin
In addition to new models, Aston Martin is also looking to continue growing its personalization program. A year after opening its “Q New York” showroom, where customers can customize their car’s paint color, interior fabrics, stitching and other details, the company has plans to open Q stores in London, Miami and California.
Stroll said some customers have been willing to pay an extra $100,000 to $200,000 on top of the car’s list price for very specific customizations, including one requesting fur interiors.
Thanks to the customization program, the average selling price of an Aston Martin has increased 35% in the past two years to $294,000.
“It’s been a huge success,” Stroll said. “Not just from a financial standpoint, but from a people perspective. [to Q New York] And then they understand what Aston Martin is and they say, ‘I get it, I get it.’ You know, it’s a show, it’s a feeling.”
Aston Martin is also attracting a younger customer thanks to Stroll’s Formula One team: The average age of an Aston Martin customer has fallen from 55 four years ago to 42 today, Stroll said.
“The brand is really popular and a lot of that has to do with Formula 1,” he said. “Our run in F1 over the last three years has really reinvigorated the brand and also reinvigorated all of our new product portfolio.”
Stroll denied reports that he was considering selling a minority stake in the Aston Martin F1 team to help finance the car company.
“We don’t need to raise capital at all,” he said. “When we start producing 8,000, 9,000 vehicles, [a year]we will be extremely cash flow positive. …So we have no need or interest in raising further capital.
Regarding the company’s electric vehicle future, Stroll said the launch of a fully electric Aston Martin would be delayed from 2025 to 2026. The company has designed four electric vehicles based on the same platform, but there has not been enough demand from Aston Martin customers.
“We’re not going to go against the flow,” he said. “Our customers, at least Aston Martin customers, performance car customers, at least we ourselves, are saying they’re not ready for electric vehicles. So we’re hearing that loud and clear.”