The Stellantis automobile group, parent company of manufacturers Peugeot, Fiat and Chrysler, unveiled its latest results for the 3rd quarter of 2024 this Thursday, October 31. They are plunging. What are the reasons? Should we be worried about historic factories, like that of Sochaux (Doubs).
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The automobile group with 15 brands is going through a difficult time after years of record profits, since 2021, the period of the merger of PSA (Peugeot-Citroën) and FCA (Fiat-Chrysler).
Stellantis had already announced at the end of September a downward revision of its operating margin objective, now estimated between 5.5% and 7%, compared to “double figures” previously, for the year 2024.
Sales are at half mast and the 3rd quarter results confirm this. They fell by 27% to reach a level of 33 billion euros. In terms of vehicles, Stellantis delivered 1,148,000 vehicles in the third quarter, a drop of 279,000 units year-on-year (-20%), Stellantis management said in a press release published this Thursday.
Difficulties in the North American market
These plunging figures are largely due to the situation of automobile sales in the American market. In North America, Stellantis’ turnover collapsed (-42%) due to a drop in sales and promotions launched to reduce vehicle stocks.
In Latin America, sales increased by 14% thanks to strong demand in Brazil and Argentina, but turnover fell by 2%, simply due to unfavorable exchange rates.
Delayed launches in Europe
If Stellantis has been struggling for several months, it is also because the European market is rather depressed. But also because the 3rd quarter of 2024 was marked by the “transition” between two generations of vehicles, with several launch delays, such as those of the Citroën C3 and C3 Aircross. These difficulties notably slowed down turnover in Europe (-12%).
How can Stellantis raise the sales bar?
If Stellantis sales plunge, we must not forget that the group is starting from very high results, a record in recent years. Stellantis is not in the red. The automobile group made a profit of 18.6 billion euros in 2023. Yes, billions.
Faced with the difficulties of the American and European markets, but also increased Chinese competition, Carlos Tavares’ group is now counting on the ramp-up of the twenty new vehicles launched in 2024, such as the new Peugeot 3008, which recorded 75,000 orders, or the Citroën C3 (50,000 orders). The group also launched entry-level electric models from its Chinese partner Leapmotor in Europe.
“It is certainly worrying, while we are in the middle of the launch, we hope that the 3008 and 5008 produced in Sochaux will be successful and will help pull the group towards a better situation” indicates Benoit Vernier, CFDT at The Sochaux factory in Doubs has been modernized in recent years to be “the factory of the future” and to address the electrical market.
For these two models 3008 and 5008, the Sochaux site is preparing to relaunch half a night shift for November, i.e. 450 temporary workers hired. The historic Peugeot factory has 5,500 employees. It also produces electric vehicles whose market is struggling to take off. “Who can afford a hybrid car today for 40,000 euros?” Sochaux CGT elected official Jérôme Boussard asked at the beginning of October.
In August 2024, all manufacturers combined, sales of electric cars in France fell by 33% year-on-year. Sales of hybrid cars have stabilized, they constitute 43% of the passenger vehicle market in August 2024.
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