Stellantis ready to axe brands: CEO

FIFTEEN brands may be more than Stellantis can bear, the Italian-American OEM reportedly set to sell-off its lossmaking ventures to ensure stronger-selling marques have a future.

 

In a report published by Reuters this week, Stellantis CEO Carlos Tavares said the automotive giant is taking steps to remediate weak margins and high inventory at its US operations and will not hesitate to axe underperforming brands.

 

“If they don’t make money, we’ll shut them down,” said Mr Tavares in delivering worse-than-expected first-half results this week. “We cannot afford to have brands that do not make money.”

 

The announcement counters Mr Tavares’ 2021 announcement in which he said all the company’s brands have a future. Analysts suggest Maserati could be first on the chopping block, the Italian brand posting an operating loss of €82 million ($A135.7m) in the first half of 2024.

 

Further, it has been suggested DS and Lancia are at the risk of being scrapped given their marginal contribution to the group’s overall sales.

 

Stellantis shares were down 12.5 per cent on the news, its lowest result since August 2023. That brings the loss for the year to date to 22.0 per cent, making it the worst performer among the European majors.

 

The report suggests Mr Tavares is under pressure to revive Stellantis’ flagging margins and sales, and to cut inventory in the US where it plans on launching 20 new models this year alone.

 

Recent poor results from other global OEMs have heightened worries about a weakening outlook for major markets including the United States, which faces an expensive transition to electric vehicles and growing competition from cheaper Chinese rivals.

 

Mr Tavares said he is working with his US team on how best to improve the situation there.

 

“We consider that the job is done in Europe,” he said. “The job is not done in the US and we are now going to take care of that work.”

 

Stellantis is the parent company of Abarth, Alfa Romeo, Chrysler, Citroen, Dodge, DS, Fiat, Jeep, Lancia, LeapMotor, Maserati, Opel, Peugeot, Ram, and Vauxhall.

 

With Reuters