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A difficult start to the year for the Stellantis automobile group. The multinational published sharply declining results for its first half on Thursday July 25, 2024.
The group must take the blame. Thursday July 25, 2024, the automobile manufacturer Stellantis published sharply falling results in the first half. Its sales fell sharply in Europe and North America.
The manufacturer’s net profit amounted to 5.6 billion euros in the first half, a fall of 48% compared to the record profit of 10.9 billion made at the start of 2023. The turnover fell by 14% over one year, the Franco-Italian-American automobile group said in its results published this Thursday, July 25.
The reason: a decline in sales in Europe (6% in particular on the Fiat 500, Opel, Mokka and Jeep Renegade), but especially in North America (-18%) where its market share and sales have fallen.
Stellantis also faced “temporary production shortages, due to a transitional renewal period” of certain flagship models, such as the Ram 1500 pickup and the Peugeot 2008 SUV.
The automobile group must also deal with the anger of many customers with regard to the PureTech engine. Voted engine of the year in its category for four years, this three-cylinder gasoline engine, launched 12 years ago, which equips thousands of Peugeot, Citroën, Ds and Opel vehicles, presents signs of premature wear. Engine oil will cause degradation of the belt.
The PureTech engine is showing premature signs of wear. • © LIONEL VADAM / MAXPPP
The company’s results for the first half of 2024 did not meet our expectations, reflecting both a difficult industrial context and our operational difficulties.
Managing Director Stellantis Carlos Tavares
Stellantis group press release
However, thanks to “reducing the costs of components, personnel and logistics” Stellantis has been able to maintain a turnover always above most of its competitors. Even though its turnover is down 4.4 points, the car manufacturer has maintained an operating margin of 10%.
Corrective measures were necessary and were taken to resolve these problems (..) We have important work to accomplish, particularly in North America, to fully realize our long-term potential.
Stellantis CEO, Carlos Tavares
Stellantis group press release
Stellantis hopes to turn the tide and record an “increase in performance for the second half of 2024 and the year 2025”, management underlined to AFP.
2024 is a “year of transition before a strong rebound with our new car ranges”, assured the group’s financial director Natalie Knight during a press conference. The 20 new models planned for this year “will be a game changer,” she said.
The drop in operating margin in North America and wider Europe is also linked to destocking operations before the arrival of these new models. The group also faced “competition with aggressive pricing policies”, underlined Natalie Knight. It therefore intends to review its prices and promotions.
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