Stellantis, the automotive colossus that owns more than a dozen brands including Chrysler, Fiat, Jeep, Peugeot, and Ram, faces challenges almost all the time.
The company’s sales and profits have been declining. Dealers trapped in parking lots full of unsold cars criticized Stellantis and its CEO in unusually harsh terms. Stellantis’ stock price has fallen nearly 50 percent from its peak in March. And the union that represents American factory workers is threatening to strike in many factories.
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It is expected that the United Automobile Workers in this area will vote in the coming days to authorize strikes against many Stellantis factories, protesting what they say is the violation of promises made by the company.
The problems raise questions about the future of Carlos Tavares, the chief executive of Stellantis, who is chasing cars in his time. After taking over at France’s PSA in 2014, he found a string of rivals that sold more cars last year than General Motors.
Last week, Stellantis said he was evaluating who should lead the company when Tavares’ contract expires in early 2026. In 2021, PSA merged with Fiat Chrysler, the combined company adopting the name Stellantis. While the company is based in Amsterdam, its US operations accounted for more than half of its profits in the first six months of 2024, meaning that the problems here reverberate across the Atlantic. “I wouldn’t want to be Carlos Tavares,” said Erin Keating, senior director of economic and industry information at Cox Automotive, a market research firm.
Jeep and other Stellantis brands have raised prices more than other automakers in recent years, Ms. Keating said, and they wait longer to offer discounts when demand slows. High interest rates have made those prices even more unpalatable to car buyers. Because of this, many people who are ready to trade in Jeep Wagoneers or Dodge Chargers they bought three or four years ago can’t afford the latest models.
Dodge dealers, on average, have 149 days to supply the lot, including most 2023 models, according to Cox. That’s nearly double the industry average. The market share of Stellantis products in the United States fell to 8.6 percent at the end of June from 10.4 percent last year, Cox said.
Sellers are angry. Kevin Farrish, chairman of the Stellantis National Dealer Council, which represents the company’s independent car dealers, blamed decisions that favored short-term profits and helped Mr.
“Reckless short-term decision-making to achieve record profits in 2023 has had tragic, but entirely predictable, consequences for the US market,” Mr. Farrish and other council members wrote in a letter to Mr. Tavares this month. “Those results include the rapid decline of our famous American brands.”
“You created this problem,” the sellers wrote in an unusual rebuke.
Stellantis refused to make Mr. Tavares was available for an interview. In a statement, the company said that his compensation is in line with other car executives, considering the company’s profit.
©2024 The New York Times News Service
First published: October 01 2024 | 12:05 AM IST