Stellantis CEO Carlos Tavares Suddenly Resigns After US Sales Drop

Carlos Tavares, the CEO of Stellantis, has resigned effective immediately, marking a significant shift in leadership for the world’s fourth-largest automaker. The board, chaired by John Elkann, acknowledged "different views" between Tavares and the leadership team as a reason for the departure. An interim executive committee will manage operations while the company seeks a permanent successor, expected to be announced by mid-2025.

Tavares, who played a pivotal role in the 2021 merger of Fiat-Chrysler and Peugeot-maker PSA Group, initially drove impressive profits and championed electric vehicle (EV) initiatives. However, 2024 has proven turbulent. Stellantis has faced declining North American sales, down 18% in the first half and 20% in the third quarter. Additionally, there's many challenges in Europe including intense competition from Chinese EV makers and reduced government subsidies.

Tavares revised the automaker's profit outlook, lowering margins to 5.5-7% from previous double-digit aspirations. Struggles with EV production delays, labor disputes in the U.S., and production cuts in Europe shows cracks in the auto giant's operations.

Tavares’ exit comes amid a backdrop of extensive organizational restructuring. Recent management changes included the appointment of new financial and operational leaders in an effort to stabilize the company. However, in America, the United Auto Workers alleged that Stellantis failed to keep the commitments it made in a contract finalized last year, even threatening to stage a nationwide walkout.

"Tavares is leaving behind a mess of painful layoffs and overpriced vehicles sitting on dealership lots," UAW President Shawn Fain said. 

Stellantis aims to increase its EV market share, planning 75 new models globally by 2030. However, achieving this goal will prove to be difficult as they need to address operational inefficiencies, labor concerns, and maintaining competitiveness in key markets.

The sudden resignation reflects a critical juncture for Stellantis, as it's unsure how big of an effect this will have. The focus now shifts to the interim leadership and finding a CEO capable driving innovation and bringing in profit into the company.


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