Aston Martin (AML) stock price is falling. Meanwhile, the company has indicated that its CEO Andy Palmer is leaving and Tobias Moers, CEO of Mercedes-AMG, will replace him.
Aston Martin Lagonda Global Holdings PLC (LON: AML) stock prices have fallen by about 4.16%. This is occurring as its CEO Andy Palmer is set to leave the company. The carmaker is famous for being the utility car of fictional Mi6 agent James Bond (007).
Sources say that Tobias Moers, CEO of Mercedes-AMG, will replace him. The carmaker had indicated in a statement that it was conducting a management review. Pundits have long speculated that this would occur. This shakeup comes as Aston Martin has failed to gain a fair share of the market.
Aston Martin (AML) Stock Continues to Fall after a Great IPO
The automaker had a memorable Initial Public Offering (IPO) with a flotation market value of about £4.3 billion.
The news pushed Aston Martin (AML) stock prices to about 35 pence. On Friday, the latest trading day, Aston Martin (AML) stock price was 35.46 GBX, which indicates a 4.16% drop.
Palmer has been steering the affairs of the automaker since 2014. Sources say that Palmer indicated that he was unaware of the decision. The company said in a statement on Sunday:
“The company confirms that it is reviewing its management team and a further announcement will be made as and when appropriate.”
Aston Martin posted heavy losses at the start of the year. The £120m loss hit the company’s books very hard. The company sold 45% fewer cars than in 2019. The losses were so bad that revenues were down by 60% to £78.6m.
The company’s financial situation was bad. So bad that the Canadian billionaire Lawrence Stroll bailed out the company with about £ 200 million.
The above amount wasn’t enough. Stroll led the company into another £536m funding round. The automaker was banking on the introduction of its sport utility vehicle to change its fortunes.
The DBX could have been the gamechanger if not for the coronavirus pandemic.
Hopes have been dampened. The COVID-19 pandemic has caused a massive drop in demand for just about everything. The DBX is no exception.
COVID-19 Caused Big Problems
Aston Martin’s emerging markets were hit hard first. Palmer told sources earlier this month:
“We were obviously fairly significantly hit by COVID-19, starting with China in January but more clearly in what we saw as it came across towards Europe and the United States.”
This has given a more dire picture than previously thought.
Germany’s Daimler AG owns a 5% stake in the automaker. The Automaker itself is going through its issues. Pundits have pointed to the fact that popular thinking is to replace Palmer with an industry hand. This swap is being seen as last-minute efforts to save the dying company.
As the year continues there seems to be no indication that things will get better for Aston Martin. For now, the hope is that Tobias Moers can bring some life into the automaker. Or at best postpone the day of bankruptcy.
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