Struggling luxury UK carmaker Aston Martin has announced that chief executive Andy Palmer has stepped down.
Tobias Moers is taking over from 1 August, with Keith Stanton filling the gap as interim chief operating officer.
Mr Moers joins from Mercedes’ high-performance subsidiary AMG, where he is currently chief executive.
Aston Martin was struggling before the coronavirus crisis hit sales and its share price is down 94% since the company’s flotation in 2018.
“The board has determined that now is the time for new leadership to deliver our plans,” Aston Martin said in a statement.
Mr Palmer said it had been “a privilege” to serve Aston Martin for almost six years.
He thanked management and staff for “their hard work and support, particularly during the challenges presented by Covid-19”.
In other management changes, the firm said three of its directors – Richard Solomons, Imelda Walsh and Tensie Whelan – had departed on Saturday. They had already indicated that they would not seek re-election in June.
The news was well received by the markets, with Aston Martin’s share price surging more than 40% in Tuesday morning trading.
Neil Wilson of Markets.com described the share price rise as “a pretty damning indictment” of Mr Palmer’s tenure.
Aston Martin sales halved in the first three months of the year, as the start of the coronavirus crisis took hold. The company sold 578 vehicles in the first quarter, down from 1,057 in the same period last year.
It caused loss before tax to soar to £118.9m, up from £17.3m the year before.
In January this year, Aston Martin announced plans to raise emergency funding worth £500m, with a consortium led by billionaire Lawrence Stroll putting in £182m
Mr Stroll, who is now executive chairman of the firm, partly owns the Racing Point Formula 1 team, which will be branded Aston Martin from 2021 under the deal.
Mr Stroll said Mr Moers was “the right leader for Aston Martin Lagonda as we implement our strategy for the business to achieve its full potential”.
He added: “Our ambition for the company is significant, clear and only matched by our determination to succeed.”
Mr Moers said: “I am truly excited to be joining Aston Martin Lagonda at this point of its development. I have always had a passion for performance cars and relish the chance to work for this iconic brand.”
Analysis: By Russell Hotten, BBC News
Aston Martin’s illustrious name has never been reflected in financial success. The 107-year-old company has gone bankrupt seven times, hence a long history of different owners and restructurings. But Andy Palmer looked at first to have found a winning formula.
When he joined in 2014 after 23 years with Nissan, the luxury carmaker was again close to bankruptcy. Palmer returned Aston to profitability, revamped the products, opened a factory in South Wales, and oversaw the company’s stock market launch.
But sales slowed, partly because of Aston’s own making and partly because of global economic conditions. Investments in electric and sports utility vehicles raised eyebrows among purists, and Palmer’s stretching of the brand into projects including a speedboat and property in Florida was just plain odd. The company ran up huge debts.
The collapse in the share price – £19 in 2018, 35p last week – underlined the urgency for change. The new team at Aston Martin have indicated a back-to-basics strategy – high performance cars and racing. Investors seem to like what they are hearing. The shares soared more than 40% on news of Palmer’s departure – a blunt verdict on his tenure.
This article was originally published on finance.yahoo.com/news/.