Alexandre
The news came like an earthquake in the automotive world on Sunday, December 1: Carlos Tavares, Managing Director of Stellantisannounced his resignation with immediate effect. This sudden departure, a year before the end of his mandate initially scheduled for January 2026, upsets the balance of the automotive giant. Here's a look at the reasons for and consequences of this unexpected decision.
A pressurized start
Carlos Tavares' departure, while surprising in its suddenness, is not entirely a surprise. As early as last September, rumors were circulating about a possible acceleration of the transition at the head of Stellantis. Poor financial results, including a 48 % drop in profits in the first half of 2024 and an 18 % decline in sales in North America, had weakened the executive's position. Despite his attempts to minimize the impact of this crisis, the confidence of the board of directors, chaired by John Elkann, seemed to be eroding.
While the official press release refers to "differences of opinion", internal sources speak of an growing tensions between Carlos Tavares and his board, exacerbated by management methods deemed too rigid and a strategy which, although effective in the past, has shown its limits in an increasingly competitive market context.
A mixed record
Carlos Tavares leaves behind a complex legacy. The architect of the successful merger between PSA and Fiat Chrysler, he turned PSA around spectacularly and transformed Stellantis into one of the world's leading automakers. However, his tenure was marked by strategic errors that ultimately weakened the group.
In the United States, poor inventory management led to massive price cuts, eroding the margins of flagship brands such as Jeep and RAM. In China, the failure of the DS strategy, coupled with a continuing loss of market share to local manufacturers, exacerbated the difficulties. In addition, the drastic cost-cutting policy, while beneficial in the short term, put a strain on teams and reduced their ability to escalate critical issues.
A closely watched transition
In the meantime the appointment of a new Managing Director, scheduled for the first half of 2025, John Elkann will act as interim CEO with a temporary executive committee. This choice marks a desire to quickly stabilize the group in an already tense period.
Carlos Tavares' future successor will have his work cut out to restore confidence, boost sales and adapt Stellantis to a changing market. Among the names circulating, Jean-Philippe Imparato and Olivier François seem to be the best placed.But no choice will be easy. The person selected will not only have to meet financial and industrial challenges, but also ease internal tensions and redefine the Group's strategic vision.
Markets awaiting answers
On Monday morning, the first stock market reactions will give an idea of the impact of this resignation on Stellantis. If the third-quarter financial results had already rattled investors, this news could accentuate the volatility surrounding the group's shares. Analysts will be keeping a close eye on the decisions of the interim executive committee and John Elkann's initial directions.
Champagne 🍾
Good riddance to this guy who has done so much damage to Italian brands.
Stellantis under Tavares, a calamitous record.
Really?! This isn't some kind of April Fool's joke, like a December Fool's joke?!
IT'S CHRISTMAS COME EARLY MY FRIENDS
😍😍🎁🎁🎉🎉🥳🥳
I hope this isn't a bad Italpassion joke!!!!
I'm not going to defend C.T.
But as far as the Italian brands were concerned, he made do with what he had, i.e. nothing, and had no other option than to pass on his experience.
Fiat and small Alfa vehicles under ex-PSA architecture, due to the lack of platforms and powertrains capable of meeting the needs of the market.
standards
The Fiat Panda is still sold with the 70-hp GSE hybrid, so it's perfectly up to standard. This will also be the case for the future 500 Torino.
Merry Christmas... For John Elkann, December will also be decisive for control of Exor. It could well be an explosive end to the year. Otherwise, concerning the management of the group, there's the Takata airbag affair (or rather the way it was handled), the Puretech engines, and the technological offer, where we have to either double our efforts or drastically reduce prices (the wide range of brands available makes it possible to do both). I'm sure that 1/ the GSE/GME engines can help restore reliability and confidence, 2/ we need to stop cutting costs everywhere, as this will ruin the group in the short term, 3/ when it comes to software and electronics, it's not necessarily possible to merge everything in the short term, unless you want to have exactly the same components throughout the group. Current practices lead to too many dysfunctions. And 4/ marketing won't do everything.
It's about time we outsourced his job! It's a pity, however, that the man who once saved PSA has sunk so low...
It was the French taxpayer and Dongfeng who saved PSA.
A good with products more or less rotten where the style of the past time of Peugeot and Citroën where is the know-how of the PSA group today there is more riens before for Citroën there was the traction the DS from 1955 to 1975 the SM from 1970 to 1975 the CX now more riens Peugeot the same thing more riens
That and putting almost 14,000 people out of work in three years.
Carlos Tavares had ideas (cross-functional groups, etc.) that were of great use to the company. But as many articles indicate, this success put him so far above the rest that problems were no longer raised for fear of being fired. The subject of reliability, which has been downplayed and never wrongly defended, remains an essential issue for the survival of the group. I often enjoyed his first 9 years, but the last year was very disappointing in terms of management and responsiveness (e.g.: pure electric fiat 500), and even unacceptable on certain subjects (usa stocks, takata Citroën, puretoc...).
I don't know if we should call terrorizing his subordinates a "success"... He was brutally fired, like a backlash, after practicing savage cutting and excessive pricing to inflate margins. But at some point, when an expensive product fails to satisfy, customers - already in short supply - don't come back. And the figures for November 2024 are catastrophic, while VW's figures are improving.
Carlos is dangerous for manufacturers, whether he's Brazilian or Portuguese.
In any case, it's going to show all those who didn't understand anything and who claimed that Tavares was the big boss that the real BOSS is AGNELLI, Fiat in short !!!! In the meantime, Tavares is going to leave with plenty of dough, just like Ghosn!
Many are rejoicing at his departure. And rightly so. Duly noted. Since his announcement that he would not be standing for re-election due to reaching the legal retirement age, and the retirement of his loyal lieutenant IMPARATO, bets on an early and precipitous departure were on the table. But that's just the tip of the iceberg. A crisis in which the entire European automotive industry finds itself! I'm full of hope for his successor, and I predict a cataclysmic future for the industry, and in particular for the STELLANTIS group. The Italian-American takeover of the group could sound the death knell for French interests. DS, for example, could be on the chopping block.
The forced electrification called for by Europe's bobo ecologist technocrats, which Carlos Tavarès mistrusted like the plague a few years ago, has accelerated this organized debacle. And STELLANTIS is not the only global group to be experiencing inextricable difficulties in these troubled times!...
Other groups' difficulties are mainly cyclical, and they know how to respond (more or less quickly) to problems. At PSAntis, the difficulties are cyclical AND structural. In short: everything has to change.
Electrification is the only way to save the car industry, in my opinion. And the technology is starting to mature, with models coming out with 700, 750kms of WLTP range, and recharging in a quarter of an hour, which is more than enough for most people. The problem is that manufacturers are adding autonomous driving, which costs them a fortune, when lane keeping, adaptive cruise control, blind spot warning and lane departure warning are more than enough. Matrix LED lights, AI, windscreen projections, screens everywhere - these are all too much, and all add up to skyrocketing costs. Similarly, shareholder demands for returns (14%!) are insane. If there are hardly any city cars any more, it's because the margin isn't high enough, but in fact we're abandoning a whole section of the population (and clogging up the cities). That's where the crisis comes from: a lack of sober products, and customers who are no longer solvent because they've outsourced everything.
Will this move boost the sales of the 500e, Giulia, Stelvio, MC20 or Tonale? I doubt. People who see Carlos as an Italophobe manager couldn't be possibly more wrong - the guy was more like the grumpy great uncle who criticizes you, but does so in order to help you improve on your weaknesses. All his observations about lack of innovation, crappy dealer network and bad Italian work ethics remains dead accurate. Except his replacement won't be so soft on the Italian brands. With Tavares out it's very likely arrivederci for Lancia & Maserati - maybe Alfa too.
We can compare Italian combustion engines with those of the French before talking about poor work ethics on the south side of the Alps, and this has been the case since the 1980s, whether at Renault, Peugeot or Citroën. We can also question the attitude of a company - PSA - which has known since 2009 that its Takata airbags were likely to kill its customers or cause dramatic accidents and which took ten years to react. Once again, the Fiat Panda is one of the most reliable models in Europe, if not the most reliable. The Fiat Tipo is also extremely reliable. And the magnificent, innovative Puretech light hybrid offers zero fuel economy. It adds nothing compared to the GSE hybrid, apart from worrying vibrations and noises (we still don't know if it's a disaster in terms of reliability). As for Carlos Tavares, he was the uncle you couldn't disagree with, or you'd be out of a job. And that's what happened to Gilles Le Borgne (strangely enough, since then, Renault cars have been more fun to drive than Peugeots). He was bound to suffer the same fate.
The Panda? A 14 year old econobox that is kept alive through artificial facelifts so the most backwards Italian customers won't budge? The Tipo? A 9-year old failed Dacia contender? Not sure if you are joking or being serious - the world is moving on from that chapter of automotive manufacturing you are so nostalgic about. Try selling the mighty Panda to a Toyota owner.
And before I'd go any deeper into critiquing the FCA heritage - I love both the Panda and the Tipo. But love won't feed the workers at Pomigliano d'Arco or Cassino or Mirafiori. For that sales are required and great products like the Giulia or 500e barely produced any. Tavares was rightly pushing for products that are more marketable - and not just to people who hum Toto Cutugno under the shower. Peugeot & Citroën sales are alright despite the Puretech debacle, so do you really think it is engine specs or airbag recalls that determine the success of a car? No doubt the ex-FCA brands invested a lot into success - except they invested it in the wrong place, so success never came. They lost touch with the 21st century consumer.
Citroën sales are 'alright'? Are you serious? Citroën is in freefall compared to Fiat, the sales dropped from 710,000 to 125,000 between 2000 and 2023 and they will struggle to reach 100,000 sales by 2024. Fiat has already sold 6 times more. As for the things that are changing: there's an economic crisis underway, and customers are running out of money. And that's it. The average age of car fleets continues to rise. It's time to offer essential but reliable products, and that's what Fiat is doing with its Tipo and Panda. They've not only had an 'artificial' facelift (what's a 'natural' facelift?) but also an engine that's nicer than Peugeot's. One that doesn't vibrate much, and isn't a source of customer distrust.
The C3 (outgoing and new model combined) sold more than 120.000 in H1 and all chevron-badged models in Europe are already past 300.000 this year. Not sure which market you are looking at, but Citroën sales are pretty well spread out across all markets, whereas Fiat market share is basically invisible in Nordic countries (<1%), completely niche in RHD markets (~1%) and pretty bad in the BeNeLux region as well (1-2%). Now even the Polish and Eastern Europeans are shunning Fiat, because of the dolce vita marketing. You keep focusing on engines (a 19th century invention soon to be phased out on the continent) and repeatedly ignore the fact that real life customers don't care about such mechanical engineering debates. They want a car they can trust - and no sane person is going to trust a car that says "Giorgio Armani" on the wheels.
No manufacturer can allow itself to make cars for times of economic crisis - you usually have economic contraction for maybe 1-2 year and then 20 years of growth - that's where the focus should be.
Everyone's raving about Carlos's departure. But do you really think things are going to be any better after he's gone? It's going to be worse.
Let me explain. According to the official press release, differences of opinion on the future of the Group led to Tavares' resignation. But don't forget that the Group's entire policy up to now and in the short term has been validated by the Board of Directors and Elkann. In other words, all the things that everyone considers bad since the merger were proposed by Tavares and validated by the Board and Elkann.
And it's this same Board of Directors that has just thanked him. And it's this same Board of Directors that will preside over the appointment of the next CEO, who will therefore follow in his footsteps. So, apart from a few changes, the Group's internal policy will not change much and will maintain its objectives. Tavares has pledged not to close any plants in France and Italy in the next few years. What's going to happen now? It could.
Éric de Riedmatten claimed that the next CEO, according to "reliable" internal sources, would be American. Trump is increasingly threatening the group with sanctions, and the Americans feel like they've been screwed since FIAT bought Chrisler, and even more so since the merger with PSA. If an American takes over, the whole of Europe will suffer. PSA went through the same thing with General Motors.
Anyway, I don't know about you, but for me the future of the group seems uncertain. Add to that a crisis at Exor, where Elkann could lose control, and the door would be wide open for anything goes.
Good news, almost everyone was waiting for this.
But what about product plans? Do you also think there's any chance of Firefly engines (at least for future models)?
We're witnessing the end of the mass-produced European automobile.