From the altars to the dust, Carlos Tavares is facing the most difficult phase of his career. The overpaid CEO (36.5 million euros compensation for 2023) of Stellantis is no longer the victorious Napoleon who conquered the kingdoms of the Agnelli and the American lands, successfully leading an army of 14 brands, but it is a leader that is losing ground in the main markets, has come under attack by trade unionists and shareholders in the United States and is contested by the government in Italy. A broken myth. The numbers are merciless: in the first half of 2024 the group sold 2.9 million vehicles (-12 percent compared to a year earlier), turnover fell by 14 percent to 85 billion and operating profit went from 14 to 8.4 billion (-40 percent). As a result, Stellantis’ stock market value has fallen by a third in the last 12 months. It’s not that the other European car groups are doing better, but while the German manufacturers are suffering above all from the drop in sales in China where they are unable to compete with local producers in the electric segment, which now represent half of new registrations , Stellantis, on the other hand, loses out in North America, where the Franco-Italian company makes more revenues and more profits: 44 percent of turnover in the half-year and more than half of operating profits. And it is precisely in the USA where there was the sharpest drop in profitability, which collapsed by 46 percent and where the market share fell from 9.6 to 8.4 percent. Stellantis made a series of mistakes here: For example, it failed to adapt when pandemic-era prices began to fall, leaving Jeep and Ram with price lists that were too high compared to their competitors and thus filling dealer lots. But there have also been delays in starting production of new models.
To avoid a Waterloo overseas Tavares has already been at work for months to empty the warehouses and relaunch its brands stars and stripes. In Europe the situation is different. The Portuguese manager has to face a structural crisis that is affecting the large Western markets: a tendency towards a reduction in sales which is no longer compensated by other outlets, such as China. The cake is smaller, the competition is multiplying and this is why we are once again talking about a difficult if not unlikely merger between Stellantis and Renault. «Judging management choices in such complex situations is not easy» comments Francesco Zirpoli, professor of innovation management economics at Ca’ Foscari University of Venice and director of Cami (Center for automotive and mobility innovation). «The impression is that Stellantis has a product range problem: it has decided to keep cars that can alternate endothermic or electrified engines on the same lines, in order to quickly adapt to demand. A choice that gives flexibility but on the other hand does not allow us to offer advanced products like those of the competition, which has focused on purely electric platforms”.
Even having to manage 14 brands like an acrobat, to which Leapmotor is now added, is not it’s easy. And Italy? Here, instead of producing one million cars, as the government expected, Stellantis will not exceed the half million mark this year, with the factories affected more or less by layoffs. The new electric 500, built in Mirafiori, also had a stop. «In our country, which suffers from higher industrial costs, the group focuses on the production of vehicles with high margins and low volumes, moving those with lower added value to Poland, Serbia and Morocco» explains Zirpoli. «A strategy that pays off if you can offer premium and competitive models in an increasingly complex market, where everyone wants to be present. And these vehicles are not there, even the Maserati is struggling. It is clear that the investments to fuel this strategy are not sufficient.” Furthermore, Stellantis, in its frantic search for cost cuts, has worsened working conditions in its Italian factories. And since the center of gravity has shifted to France, our country has lost its centrality in the development of new products, particularly in the small car segment. Tavares has 2025 ahead of him to revive the group’s fortunes with models that finally convince the market. If he fails to do so, he risks being replaced at the beginning of 2026 – once his contract expires. Of course, however, he will do everything he can to avoid ending his career in the dust of defeat.
