Stellantis targets annual synergies of 5 billion euros, announces management structure

Stellantis, the car-making giant formed by the merger of the PSA Group and Fiat Chrysler Automobiles (FCA), will embrace the diversity of its staff and brands as a strength rather than a weakness, according to boss Carlos Tavares.

The new company is the world’s fourth-largest car firm, with 14 brands (including Abarth, Alfa Romeo, Citroën, DS, Fiat, Jeep, Peugeot and Opel/Vauxhal), more than 400,000 staff, industrial operations in more than 30 countries and revenues of more than £150 billion (Rs 1,358,850  crore) combined.

Not surprisingly, the multi-brand Stellantis will leverage its size and economies of scale as an enabler to invest in innovative mobility solutions for its customers, targeting annual synergies of more than 5 billion euros (Rs 41,335 crore). These synergy estimates will be achieved by implementing smart purchasing and investment strategies, optimising powertrain and platform utilisation, applying cutting-edge R&D and a continuous focus on manufacturing and tooling efficiencies. These synergy estimates are not based on any plant closures resulting from the transaction.

Nine Governance Committees will ensure an efficient operating structure from Day One, including company-wide performance and strategy, planning, regions, manufacturing, brand and styling. Stellantis says its portfolio is “uniquely suited to offer distinctive, sustainable mobility solutions to meet its customers’ evolving needs, as they embrace electrification, connectivity, autonomous driving and shared ownership. As the electrified market continues to grow, Stellantis is well positioned today with 29 electrified models available and plans to introduce ten additional vehicles by the end of this year.”

Catering to over 130 markets
Stellantis’ 14 brands brands cover the full spectrum of market segments from luxury, premium and mainstream passenger vehicles to pickup trucks, SUVs and light commercial vehicles, as well as dedicated mobility, finance and parts and service brands.

It already has a well-established presence in three regions – Europe, North America and Latin America – in addition to significant untapped potential in important markets such as China, Africa, the Middle East, Oceania and India. The multi-brand giant caters to over 130 markets and starts from a position of considerable strength with robust operating margins reflecting its leading positions in North America, Europe and Latin America. 

Management structure
Stellantis has now provided further details of its management structure, with a number of new bosses for key brands. The 11-member Board of Directors is led by Chairman John Elkann. Carlos Tavares as Chief Executive Officer leads one of the most experienced and successful management teams in the industry whose diversity, experience and competitive spirit are amongst its key strengths.

Mike Manley, who had been CEO of FCA, will become the head of the Americas, where the firm’s popular Jeep and Ram brands are focused.

Linda Jackson, who previously headed up Citroën, has been named as the new head of Peugeot.

Peugeot boss Jean-Philippe Imparato will move over to run Alfa Romeo, replacing Tim Kuniskis, who will focus on Chrysler and Dodge.

Michael Lohscheller (Opel/Vauxhall), Vincent Cobée (Citroën), Olivier François (Fiat/Abarth), Béatrice Foucher (DS) and Davide Grasso (Maserati) retain their roles.

While Tavares admitted there was a “defensive dimension” to the merger based on the challenges the car industry is facing, he said “this merger is not a defensive move,” adding that Stellantis won’t be focused solely on its new scale.

He said: “Stellantis needs to be great rather than big. We want to gain scale, of course, and to make sure we use this scale to develop innovation and as a lever to be more disruptive and to do things some other companies could not do. The purpose is not to be big; the purpose is to be great at what we do.”

Tavares said the success of past mergers with companies now part of Stellantis – particularly the merger of Fiat and Chrysler and PSA’s 2017 purchase of Opel/Vauxhall – showed that Stellantis can succeed, and that embracing the diversity of its 14 brands will be key.

“We have within those 14 iconic brands a high diversity of models. We are present in the most significant markets and most significant profit pool areas of the market.

“We will value the diversity of our people. We don’t need to have one unique culture; we will leverage our diversity. Our people are unique, and they should stay as they are. It will be my job to leverage this diversity to offer exciting opportunities for customers. We think this diversity is a strength and compare it to the lack of diversity to some of our competitors.”