Stellantis NV shares dropped the most on record after the automaker announced €22 billion ($26 billion) in charges related to reversing its electric vehicle plan.
The writedowns include nearly €6.5 billion in cash payments primarily to compensate suppliers, highlighting similar actions taken by rivals such as Ford Motor Co. and General Motors Co. The manufacturer of Jeep SUVs and Fiat cars is phasing out several models and projects due to rising costs and shrinking market shares in Europe and the US, according to a Bloomberg report.
Stellantis shares crashed as much as 24% in Milan, wiping around €5.4 billion off the company’s market capitalisation as the charges significantly exceeded analyst estimates, the report noted.
What did CEO Antonio Filosa say?
The Chief Executive Officer, Antonio Filosa, said that the move “largely reflects the cost of over-estimating the pace of the energy transition,” implying responsibility on his predecessor, Carlos Tavares. Filosa added that the reset demonstrates “the impact of previous poor operational execution, the effects of which are being progressively addressed by our new team.”
Filosa, who assumed leadership in June, is working to revamp the car manufacturer to reclaim market share. He is also scaling back EV ambitions and addressing increasing tariff costs. The announcement on Friday aims to guide the company through a difficult period following Tavares’s tenure, during which profits and sales fell sharply in Europe and the US.
The slump stems from resistance of buyers against price hikes, gaps in Stellantis’s lineup, and quality concerns. Tavares had committed to selling only electric vehicles in Europe and reaching 50% EVs in the US by 2030, but the company soon revised these targets after his departure in late 2024. Additionally, Stellantis is modifying its battery manufacturing plans to better match the lower demand.
Concerns among other automakers
Stellantis isn’t the only automaker facing costs from slower-than-expected EV sales. In December, Ford announced it would incur $19.5 billion in charges related to restructuring its electric vehicle operations. Meanwhile, General Motors’ writedowns increased to $7.6 billion. Additionally, Porsche AG repeatedly revised its outlook downward four times last year while adjusting its strategy EVs.
The charges announced on Friday will affect the second half of the 2025 financial year but will not influence adjusted operating income. Stellantis also announced that it will not pay a dividend this year.
Stellantis expects a net loss of up to €21 billion for the second half of 2025. This year, it expects a low single-digit operating margin, including roughly €1.6 billion in tariff-related costs. The company intends to raise up to €5 billion through bond issuance to strengthen its financial position. Detailed full-year earnings will be released on February 26.
The automaker also announced it is exiting a joint venture with South Korean battery manufacturer LG Energy Solution Ltd. in Canada. In 2022, Stellantis stated it would invest more than $3.7 billion with LG Energy to create the first large-scale EV battery plant in Windsor, Ontario. LG is now purchasing the stake in Stellantis, the report said.
