• The head of the Stellantis group warns that money-losing brands will disappear.
When the Stellantis Group was established in 2021, new CEO Carlos Tavares said he had no intention of eliminating any of the 14 newly combined brands. Rather, he was giving each of them 10 years to prove themselves, after which decisions would be made.
It looks like we won't get to that deadline before something happens.
Yesterday, Carlos Tavarez said he won’t hesitate to eliminate underperforming brands to remedy the U.S. division’s current low margins and high inventories.
“If they don't make money, we'll shut them down,” the executive told reporters at a meeting during which Stellantis, the world's fourth-largest automaker by volume, released its results for the first half of the year, which came in below expectations. Shares of the company fell by 10 percent in the wake of those results.
“We cannot afford to have brands that do not make money.”
- Carlos Tavares, CEO of Stellantis
Among the brands that are probably tight in the collar today, two spring to mind: Chrysler and Maserati. Elsewhere in the world, banners such as Lancia or DS could also be dropped, due to their low contribution to sales figures racked up by Stellantis.
Tavares is under pressure to boost margins and sales, as well as reduce inventories in the U.S. To help sales, Stellantis is banking on the launch of 20 new models this year, a move it hopes will boost sales and profitability. It's true that the company’s brand lineups currently lack freshness, let’s put it that way.
Carlos Tavares plans to spend the summer working with his American colleagues to find solutions. “We consider that the work is done in Europe. The job is not done in the U.S., and we are now going to take care of that work,” he promised/threatened.
All bets are off as to what's next.