Let's hope Aston's gamble pays off.
Aston Martin had a record sales year in 2017, earning $1.2 billion and ending the year with a net profit. Sales continued to increase through 2018 as well, though the company still ended the year in the hole. The UK automaker is rumored to be in talks with outside investors, which could improve its financial position. Aston Martin CEO Andy Palmer has denied these claims and in a recent interview with Automotive News Europe, he talked about how the DBX SUV could be the vehicle to finally make the company profitable.
"Every car we launch is important because of the way the business runs. But in terms of changing the company so that we address each of the luxury clusters, this is really important. So far, we have replaced the core GT and sports cars - our historical ground. This is the first model that expands the portfolio," Palmer said when asked how important the DBX is to the Aston Martin brand.
Palmer believes the DBX will sell "about 4,000 a year with a peak of 5,000," which is significant for Aston's yearly sales volume. "I can't give forward-looking data but we are about 6,000 to 6,500 units this year," Palmer said. "We will not have a full year of DBX but we've more sports cars coming: the Vantage roadster arrives next year, and the mid-engine car [the Vanquish comes in 2021]. The DBX will represent the largest-single volume."
Adding in around 4,000 to 5,000 DBX sales to Aston's yearly volume would put the company between around 10,000 to 11,500 yearly sales. In other words, nearly double what it sold in 2018. If doubling sales doesn't do the trick for Aston Martin to turn a profit, we don't know what will.
When asked where he thought DBX customers would come from, Palmer responded with a clear answer. "Today more than 70 percent of Aston Martin customers have an SUV in the garage, so the hard work is already done. We just need to convert those people from their daily driver into an Aston Martin SUV," he explained. "They are coming out of Porsche Cayennes and Range Rovers. What we are looking to do is cream off the top of that premium SUV sector. The Cayenne has been an important benchmark in the development of the car. Our cars don't compete directly, but they [Porsche] are a very credible source when it comes to ride and handling, and build quality."
Palmer was also asked his thoughts of the Aston Martin stock, which is down 80 percent since the IPO.
"There's no point in looking backward. The share price is obviously a disappointment and I have to acknowledge my role in that, he said. "But we have to get on and improve it. I think the importance of the DBX, and whether we can deliver it efficiently, will also affect the share price."