Aston Martin Lagonda’s share price plunged by 26% on Wednesday after the luxury carmaker revealed a slump in sales across Europe, blaming the impact of economic uncertainty.

The beleaguered company stunned investors on Wednesday by reporting an unexpectedly steep decline in demand from dealers in the UK and Europe.

Chief executive Andy Palmer said the car market across the continent had worsened since its last update in May. He blamed “macro-economic uncertainties and enduring weakness” and warned shareholders not to expect improved conditions this year.

Aston Martin’s market value has more than halved since it floated on the London Stock Exchange in October, which had put a price of £19 on its shares and valued the company at £4.3bn. Its shares were worth £7.67 after Wednesday’s fall, a loss of value since the float equivalent to £2.5bn – and more than 100 times the £24m cost of the seven Aston Martin DB10s destroyed during the filming of the James Bond film Spectre in 2015.

The 106-year-old company behind Bond’s favourite car marque slashed its annual sales forecast from a range of 7,100 to 7,300, saying it now expects to sell 6,500 at most. The fall-off reflects low orders from car dealers concerned that they won’t be able to sell them.

The downturn was particularly acute in the UK, where sales fell by 22% in the second quarter of 2019. Sales in its combined Europe, Middle East and Africa region tumbled even further, losing 28%.

Overall sales edged up 4% in the period as the falls were offset by higher sales elsewhere, particularly in the US, where an 83% surge saw it overtake the UK to become Aston Martin’s biggest market. However, the figures disappointed market watchers, who had hoped for a stronger performance in the UK and Europe.

“We are not seeing people cancel orders, but softness in terms of new orders, in particular on dealers and dealer confidence,” said Palmer. “As a luxury brand, we simply shouldn’t make cars we don’t think we are going to sell. It is about matching our order book.”

Palmer, who has been criticised for collecting a £1.2m salary despite Aston Martin’s underperformance, said retail sales – the number of cars bought by consumers from dealers – remained strong globally and that the focus was on the successful launch of its DBX, the brand’s first ever sports utility vehicle.

“We want the dealer inventory to be tighter to ensure that as we move to DBX dealers have the funding lines to take those cars,” he said. “We need to clear the ground for the DBX launch … making sure we absolutely succeed with DBX. As we look forward, we see reasons to be cautious, not optimistic. It is always more prudent for us to underproduce cars than overproduce and undersell.”

The company is hoping that the DBX, which will retail at £140,000-£160,000, will become Aston Martin’s most popular model, helping to double production.

Aston Martin has opened a new factory in St Athan in south Wales to manufacture the first pre-production DBXs. The vehicle is being launched in December, with production due to start in the second quarter of next year.

But the company said it would “take immediate actions to improve efficiency and reduce our fixed cost base” in the light of its poor performance.

The statement is likely to raise concerns that it could become the latest car manufacturer to announce job cuts in the UK, following redundancies and site closures at Ford and Honda.

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Analysts at stockbroker AJ Bell said the company might be better off going private again, given its poor performance since becoming a listed company. “Floating on the stock market can boost a company’s reputation and provide an opportunity for the public to buy into the story,” said investment director Russ Mould. “However, it can also expose a company to criticism from investors, who are watching every move like a hawk.”

He added: “Its credibility could be shattered for some time as investors question if they can trust management to do what they said Aston Martin would do at the time of [the float] last October. The situation shows how vulnerable it is to a period of economic weakness.”