the essential
Carlos Tavares has been at the head of the Stellantis group (formerly PSA) for ten years. The business leader is at the origin of numerous successes… but has suffered decisive setbacks in recent years.
It only took a few months of shortage at Stellantis to end the Tavares era at the head of the group. This Sunday, December 1, Carlos Tavares announced his resignation “with immediate effect”. It had been just ten years since the business leader arrived at the head of the PSA group… The few months of falling sales will have got the better of the Portuguese, despite the car manufacturer's years of success.
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The sixty-year-old, known for his intractable method, was already on borrowed time: the board of directors had announced his retirement at the beginning of October and launched a succession process, but disagreements accelerated his resignation. The planets were no longer aligned, with “different points of view” between the board of directors and the manager, explained Henri de Castries, administrator of Stellantis.
The successes of the business leader…
In 2014, when he arrived at the head of the PSA Peugeot – Citroën group, Carlos Tavares had a mission. The car manufacturer is on the verge of filing for bankruptcy: with its thirty years spent at Renault, it must redress the situation. The person concerned first cuts costs: the group only managed to return to profit after the loss of 17,000 jobs. Intractable, we said.
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But Carlos Tavares is above all the architect of the great merger within the French automotive landscape. First between PSA and FCA (Fiat-Chrysler), then with the acquisition of Opel. The project then takes on a new scope with the creation of Stellantis in January 2021. The group absorbs a total of 14 brands ranging from Peugeot to Fiat via Chrysler and Maserati. In the lot we find the famous “DS”, then established as an automobile brand in its own right. The group must subsequently anticipate and shift its production towards hybrid and electric.
…and failures
The year 2024 could well have got the better of the sixty-year-old. In the first half of 2024, with net profit halved, the group's finances are struggling. Gradually, Stellantis' margins are collapsing in the face of more serious difficulties than expected in North America – Carlos Tavares' cash machine – with vehicles of criticized quality and prices considered too high. Quality? Criticized among other things because of the PureTech engine: the machine, developed in 2012 by the PSA group – and voted best engine of the year four times – was strongly criticized due to a large number of failures. Between 2020 and 2022, Stellantis had to recall nearly 500,000 vehicles.
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In this year 2024, the business leader had to abandon at the end of September his sacred objective of a “double-digit” operating margin for the year, which placed him far ahead of his competitors, and justified his planned salary at 36.5 million euros for the year 2023. At the same time, he shook up the group's organization at the beginning of October, choosing more commercial profiles to boost sales. The year 2024 was also marked by delays in the launches of several models, caused in particular by electronic problems. The drop in production in many factories did not fail to worry, as in Italy, home of Fiat, where thousands of demonstrators demanded accountability in mid-October. The government of Giorgia Meloni criticizes the manufacturer for relocating its production to low-cost countries, to the detriment of Italian factories.
Questioned, the former Minister Delegate in charge of Industry, Roland Lescure, affirms that Carlos Tavares did a “fantastic job” for the Stellantis group. The latter, however, believes that “for a year or two, it seems that he has lost his touch”. 2023 and 2024 may have got the better of Carlos Tavares.
