Stellantis Electric Car Disappointment: Shares Plunge

The company informed about this in a press release and at the same time stated that it will not pay a dividend this year. Its shares weakened sharply in response to the news and lost more than 25 percent on the Milan Stock Exchange shortly after 2 p.m. CET.

“It mainly reflects extraordinary costs stemming from an overestimation of the pace of the energy transformation, which has moved us away from the real needs, possibilities and wishes of many people who buy cars,” said Antonio Filosa, head of the automaker, about the extensive write-offs. He became the head of the company last June. According to him, the write-offs also reflect the previous weak operational management of the company, the consequences of which are now being dealt with by the new management.

Other major car companies, such as the American companies General Motors and Ford Motor, have already started extensive write-offs in connection with the deterioration of the prospects for the electric car market.

After Filosa took office, he began to limit the plans of the Stellantis car company in the field of electric cars. He replaced Carlos Tavares as CEO, whose intensive electrification efforts contributed to a protracted decline in sales in Europe and North America, Reuters reported

As part of a change in strategy under a new boss, carmaker Stellantis agreed on Thursday to sell a 49 percent stake in a battery joint venture in Canada to its South Korean partner LG Energy Solution.

However, Gartner analyst Pedro Pacheco warned that Stellantis and other automakers could be going too far in their shift away from electric cars. “Changes in strategy are overkill,” he said. He added that car companies must choose the right approach to electric cars, on which, according to him, their survival may depend.

Stellantis now expects to report a loss in the range of 19 to 21 billion euros for the second half of last year due to extensive write-downs, writes Reuters. In the second half of 2024, the company’s loss amounted to 127 million euros. The company will publish the final results for the second half of last year and for the whole of last year on February 26.

The Stellantis Group was formed in early 2021 by the merger of the Italian-American automotive group Fiat Chrysler Automobiles (FCA) and the French competitor PSA. In the first half of last year, the company plunged into a loss of 2.3 billion euros after a profit of 5.6 billion euros in the first half of 2024.