City needed to claim all three points from their final Barclays under-18 Premier League encounter to be in with a chance of qualifying for the finals but this heavy defeat in the Midlands means that interest in a league title will have to wait for another year.
Angus Gunn saved two penalties in a game which Villa drafted in five members of the NextGen Series-winning team.
The home side were in devastating form and raced into a six goal lead before the break but City rallied and even after a red card on 60 minutes, dug in to prevent an even heavier defeat.
City had made all of their substitutions when they lost another player to injury with 15 to play, but still managed to grab a nicely-taken consolation goal courtesy of Seko Fofana.
Recent wins at Norwich and Middlesbrough had propelled Sadler’s men to the top of Phase 2 of National Group 2 but now Newcastle are in pole position for a place in the play-offs.
City finish Phase 2 with a W5, D3, L4 record and will begin their second Barclays under-18 Premier League campaign on Saturday 17 August.
