Key Takeaways:
– Carlos Tavares, CEO of Stellantis, faces open criticism from the US Stellantis National Dealer
Council for the company’s declining performance.
– Major brands under Stellantis have experienced a significant decrease in sales and overall market
share.
– Stellantis has acknowledged the allegations, denying any public disputes while assuring the
stakeholders of their commitment to progress.
– Despite these issues, Stellantis is investing $406 million in electric vehicle production and has
not planned to eliminate any of its in-house brands.
A Bumpy Ride for Stellantis
The journey for automotive conglomerate, Stellantis, under the leadership of CEO Carlos Tavares, is proving to be a challenging one. Dealers across the US have voiced their discontent over what they label a ‘disaster’ under Tavares’ leadership.
Tavares assumed the mantle as the company’s first CEO in 2021, following the merger of Group PSA and Fiat-Chrysler Automobiles. In a recent open letter, the US Stellantis National Dealer Council has accused him of steering the world’s fourth-largest automaker into troubled waters.
Criticisms Against Tavares’ Leadership
The grievances aired by the dealers are multifaceted but are primarily focused on Tavares making nearly $40 million last year while the company experienced a “rapid degradation” of its major brands. This includes Jeep, Ram, Dodge, and Chrysler.
Taking a closer look at sales, Jeep suffered a 9% decrease in the first half of 2024, while Ram experienced an even larger drop at 26%. Chrysler and Dodge underwent an 8% and 16% decline, respectively.
Not a Rosy Picture for Major Brands
Despite Fiat seeing an upswing of 67%, it provides little comfort as the Italian brand only sold 316 cars in the US through June 2024. Alfa Romeo, however, saw a slight increase of 2% in deliveries.
The open letter, available in PDF format as of September 10, indicated that dealers harbored significant concerns about the direction Stellantis appeared to be heading. They highlighted the sliding market share, plummeting stock prices, rampant layoffs, and escalating lawsuits as signs of a company in decline.
Stellantis Fights Back
Stellantis promptly issued a response to the allegations, denying any personal attacks against its CEO. The company maintains that it has started down a successful path and is committed to working with dealers to resolve any disputes.
Amidst the unfolding situation, Stellantis announced plans to invest $406 million at three Michigan plants for building electric vehicles. The company is determined to improve the quality of its vehicles and has no plans to eliminate any brands under its umbrella.
Stellantis had pledged to invest in all brands for ten years when the conglomerate was created in 2021. This move extends a lifeline to struggling brands such as Chrysler, Lancia, and DS Automobiles until the end of the decade.
Seeking the Silver Lining
Despite the criticism, US dealers remain hopeful for the right decisions that would allow Stellantis to regain lost market share and fully utilize their production capacity. They have urged Tavares to prioritize building and selling cars that Americans want to buy and can afford.
The US Stellantis National Dealer Council claims to have anticipated the current situation and has consistently been raising concerns over the past two years.
Stellantis now exists in an industry-wide turbulence, with its rival Volkswagen Group also undergoing difficulties. The Group’s financial boss, Dr. Arno Antlitz, projected that the company has “one, maybe two” years to put things back on track. Thus, the trials of Stellantis, under CEO Tavares, is something to monitor for any industry stakeholders.