John Terry leaves Aston Villa as owner Tony Xia admits club faces "severe" FFP challenges

Terry’s exit had been expected after Saturday’s play-off final defeat to Fulham left Villa facing a third season in the Championship.

The former England captain was set to stay had they regained top flight status and, it is understood, would have even considered playing another year in the second tier.

But financial pressures mean Villa are now unable to afford his £60,000-a-week salary.

In a statement, Xia admitted missing out on an estimated £175million Premier League windfall had left the club facing “severe” Financial Fair Play challenges.

The owner also thanked Steve Bruce “from the bottom of my heart” for his efforts, though he stopped short of confirming the manager will remain in charge.

It is thought Villa need to raise around £40million in transfer sales and wage cuts in order to comply with Financial Fair Play regulations next term and may be forced to sell prize assets including Jack Grealish.

Xia, who has splashed out more than £90million on signings since purchasing the club from Randy Lerner two years ago, said: “We are all aware that we will face severe FFP challenges next season.

“I am an Aston Villa fan. But I am also a businessman. Under the current circumstances, I think the club needs to rethink not only the past two years but also the past ten years.

“Villa needs to be a sustainable football club.”

He continued: “We have been heavily investing for the past two seasons. However, the loss on Saturday means that we need to change a lot of things.

“No-one wanted to see the club have to go through this, but I believe that only changes can help the club to progress towards the positive direction and this requires the joint efforts of everyone associated with this great football club.

“No matter what the changes will be, I sincerely hope that everyone can unite and overcome the challenges together.

“Our goal has not changed and as long as we believe, regardless of how tough the process will be, I am sure we will succeed in the end.”

Bruce guided Villa to a fourth-placed finish in the Championship despite experiencing personal turmoil with the loss of both parents.

But Wembley disappointment and failure to win promotion has left his position uncertain.

Xia said: “I know that all our management staff, coaches, players and myself need to get back on our feet and prepare to fight again.

“Like everyone else, I'm delighted to see that under Steve’s management this season, we demonstrated character and unity.

“We fought like a team. Indeed, the loss is a pity, but we know how much effort and hard work our coaching staff and players put in this season.

“I want to thank Steve from the bottom of my heart, particularly for his remarkable level of professional focus despite losing his parents this year.

“With that, I would like to say thank you to Steve and his coaching staff once again for leading the team forward wholeheartedly throughout the season.”

Terry, who signed a one-year deal last July following a trophy-laden two decade stay at Chelsea, leaves Villa having made 36 appearances in all competitions.

In a message posted on Instagram, Terry wrote: "Today I part ways with Aston Villa Football Club. I’m very proud to have had the opportunity to play and captain this great and huge club.

"I have given my everything this year both on and off the pitch and I’m still hurting today that we never managed to get back to the Premier League, where this club 100% belongs.

"I would like to thank Steve Bruce who was instrumental in me joining Villa, I have learnt so much from him as a manger this season that will stay with me forever. Also, I’d like to thank all the staff and players and our owner Dr Tony, who it was a real pleasure and honour to work with everyday.

"Finally, a special thank you to the Villa supporters who have supported us both home and away in their thousands, up and down the country and have been amazing to me on a personal level.

"Villa will always have a place in my heart and I will look back on my time here and think about how close we were to reaching our goal. But now going forward, I would like to wish the management, staff, players and supporters good luck for the future."