Carlos Tavares, who has been at the helm of the Stellantis group since 2021, has fallen from his pedestal. He leaves his position with immediate effect, and plunges a juggernaut with 14 brands into uncertainty. But the way out of the crisis is being organized…
With 14 brands currently in its fold, Stellantis is one of the most powerful automobile groups in the world. And his success is attributable to his famous boss, Carlos Tavares, whose methods have always been criticized, to say the least.
Stellantis and the Tavares method
This former number 2 of Renault, arrived at the helm of PSA in 2014had undertaken at the time an unprecedented action plan to turn around the group. Peugeot and Citroën were saved at the last minute from bankruptcy through layoffs and factory restructuring, and DS Automobiles emerged from the ground to generate cash by navigating the upper echelons of premium. A successful bet for this “performance psychopath” as he described himself, who had even afforded himself the luxury of buy Opel, snatched from the clutches of General Motors in 2017. Consecration finally arrived in 2021, when PSA and Fiat-Chrysler merged to form the new Stellantis group, of which Carlos Tavares took the helm. It is under his leadership that Jeep, Alfa Romeo, LanciaRAM and even Maserati have been relaunched, by evolving their positioning, reviewing their industrial strategies, and launching numerous new products, both on the European market and in emerging countries. Result, in 2023, Stellantis posted one of the best performances in the sector, with net profit up 11%, and a record operating margin set at 12%! Carlos Tavares had reason to be jubilant…
Management errors at several levels
Only, the year 2024 turned into drama. Electric car sales are disappointing, reliability problems are increasing (windshields, Takata airbags, seat belts, 1.2L Puretech and 1.5L BlueHDi engines…), and above all, the American soldier collapsed! Because yes, the real goose that lays the golden eggs for the Stellantis group is North America, where it sells the RAM, Jeep, Chrysler and Dodge brands. By wanting to prioritize the European market too much, Carlos Tavares abandoned his American brands, and they paid a high price. Chrysler is in a state of brain death and only markets one model, the Pacifica minivan, Dodge is cruelly awaiting its new Charger after the failure of the Hornet SUV (a rebadged Alfa Romeo Tonale), while RAM and Jeep have been hit hard by manufacturing defects and assembly hiccups. The group's North American deliveries fell by 18%. in the first half, and its market share fell from 10% to 8.2%. Currently, these are still tens of thousands of SUVs and pick-ups clogging up American dealership parking lotslack of sales, and which cost Stellantis a fortune. Management errors which did not prevent the main party from obtaining a new record remuneration: 36.5 million euros for the year 2024.
The end of the Carlos Tavares era
Faced with the discontent that has been growing in recent months, Carlos Tavares announced that he would leave his position in 2026. But the group's board of directors decided otherwise, and this Sunday 1is December, Carlos Tavares officially presented his resignation with “immediate effect”. Enough to plunge the Franco-Italo-American group even further into uncertainty. But how can we envisage the future? Already, and while waiting to find a replacement (in the first half of 2025 we can read), it is John Elkann, president of Stellantis, who will take over as interim head of general management. And it might have no other choice, to put the accounts back on track, to get rid of some of its brands. Maserati ? The manufacturer is torn between a complicated positioning in relation to Ferrari and Lamborghini, and its electric models are unsaleable. Chrysler et Dodge ? They are in a very critical financial situation and have obviously never been the group's priority since its creation in 2021. Alfa Romeo? Its transition to 100% electric is going much more difficult than expected. Failing to part with its brands, Stellantis could also decide to rationalize its industrial toolsby closing several of its factories, or returning to a strategy of volume and no longer value, by selling your cars cheaper to sell as many as possible (the “Ghosn” method).
In any case and after the announcement of the premature departure of Carlos Tavares, Stellantis group shares fell 8% at the opening this December 2. Everything now remains to be done.
