LONDON (Reuters) - British luxury sports car maker Aston Martin ASTON.UL has ended its foray into the supermini segment by dropping its Cygnet city car from the range after poor sales, a source close to the company said.
The source said Aston Martin’s two-door Cygnet, which was based on the Toyota iQ, had been dropped from the company’s line up after it “sold less than 150 units” of the 32,000 pound vehicle in Britain.
When it started production three years ago, Aston said it hoped to sell 4,000 Cygnets a year to environmentally conscious city dwellers thought to be keen on a small, easy to park, luxury vehicle.
Aston Martin has struggled for growth since the economic downturn in 2008 and ratings agency Moody’s put its non-investment grade B3 rating under review late last year.
The group posted a 16 percent fall in full-year profits, blaming global economic uncertainty for a severe slump in sales of high-end vehicles.
The carmaker, which is majority owned by Kuwait’s Investment Dar and Adeem Investment Co, reported a pretax loss of 24.6 million pounds in the year to December 2012, down from the 21.2 million it posted a year earlier.
Revenues fell 9 percent to 461.2 million, with global sales volume down to 67,500 units, from a peak of 110,000 units in 2007.
The company, which celebrates its centenary this year, said the “market segment has been severely affected by recession” and highlighted “weakness in European markets and vehicle launches occurring in the fourth quarter.”
Earlier this year Aston Martin agreed to team up with Daimler’s (DAIGn.DE) high-performance Mercedes-AMG GmbH division to develop a new generation of bespoke V8 engines.
Aston Martin, the only global luxury carmaker not attached to a larger manufacturer, hopes the deal will help it better compete with the likes of Volkswagen’s VOWG_P.DE Bentley and Porsche units, as well as UK rival Jaguar Land Rover, which was bought by India’s Tata Motors (TAMO.NS) in 2008 and has since achieved huge sales growth, especially in China. (Reporting by Rhys Jones; editing by Kate Holton)