In business, as in an endurance race, staying upright is not enough. You have to keep the pace, anticipate obstacles and, above all, react quickly. Stellantisthe automobile conglomerate that brings together 14 brands (Citroën, Peugeot, Opel, Jeep, Fiat, Alfa Romeo, Chrysler and Dodge among others), seemed to have found the perfect balance in recent years. However, in 2024, the accumulated problems have led the group to skid. The recent early departure of Carlos Tavares, its CEO, has left the industrial giant sunk in the stock market, while its margins erode, your sales are reduced and his leadership is questioned.
The contrast between 2023 and 2024 could not be more drastic. Just look at the figures. In the first half of this year, the net income of the group fell by 14%, remaining at 85,000 million euros. Net profit fell 48%, and the third quarter did not bring any respite. Stellantis posted revenue of €33 billion, 2% less than the same period last year, and vehicle deliveries were down 20%. The actions of the group reflect this situation: its value has fallen by 43% in twelve months, reducing its capitalization to just 37,000 million euros.
Key Conflicts Stellantis Faces
Carlos Tavares, known for his ability to optimize costs and lead the integration of PSA and Fiat Chrysler, had consolidated Stellantis as the world’s fourth largest automobile manufacturer. But here comes the problem. This focus on savings had a side effect: growing tensions with dealers and suppliers, who felt relegated to the background in a scheme that prioritized centralization and efficiency over strategic relationships.
On the other hand, dealers have for years denounced the policy of “pushing inventories”, which forces them to absorb large amounts of vehicles even in contexts of lower demand, eating into its profitability. In the case of suppliers, complaints revolve around constant renegotiations of contracts and demands for lowest pricessomething that has left many on the verge of unviability.
Added to this is the reliability crisis in some key models. Problems in the PureTech engines, due to a recurring failure in the timing belts that led to serious breakdowns, and in the AdBlue system, an essential component to comply with emissions regulations in diesel vehicles, damaged the reputation of brands such as Peugeot and Citroën. , and forced the company to assume extraordinary costs in repairs and compensation.
The weight of Italy and the uncertainty in Spain
As if that were not enough, the situation in Italy has been a powder keg. Stellantis, owner of iconic brands such as Fiat, Alfa Romeo and Maserati, has reduced activity in its Italian factories by 41% since the group’s creation. It is not surprising that the unions accuse the conglomerate of relocating production to cheaper markets like Morocco, Poland or even Spain.
In Spainthe story is different, although no less complicated. Stellantis maintains important production centers in Vigo, Zaragoza and Madrid. In fact, the plants in Galicia and Aragón are key to the future of the group, with investments planned of more than 4,000 million euros in projects such as the construction of a battery plant in Zaragoza and the introduction of the STLA Small platform in Vigo, intended for compact electric vehicles. However, financial uncertainty could compromise these initiatives in the long term.
To get an idea of ​​the problem, in Zaragoza, the Opel Corsa and Citroën C3 Aircross factory suffers preventive stoppages with an ERTE that affects 4,200 workers since December.
Stellantis seeks 100% electric car sales
The “Dare Forward 2030” strategic plan is Stellantis’s commitment to get on the electrification. Their goals are ambitious: achieve 100% sales of electric vehicles in Europe and 50% in the United States by 2030.
But things don’t go as expected. In 2024, electric vehicle sales represented less than 15% of the group’s total, far behind competing brands such as Tesla or BYD. The problem? High pricesinsufficient charging networks in Europe and the United States and, in general, a market that is not taking off.
The Stellantis case is not unique. All the European automobile industry is in a perfect storm. In 2024, vehicle production in the region fell to 14.4 million units, down from 15.3 million the previous year. Factors such as the slowdown in sales in Europe and China, competition from Chinese manufacturers and the high costs associated with electrification have hit large groups such as Volkswagen, BMW and Mercedes-Benz hard.
However, there are also success stories. renaultunder the command of Luca de Meo, has been able to anticipate events and understand the needs of the sector, increasing its market share by 3.5% this year. It is no coincidence that his name is one of the most talked about to lead the change in strategy that is coming at Stellantis.