news

한어Русский языкEnglishFrançaisIndonesianSanskrit日本語DeutschPortuguêsΕλληνικάespañolItalianoSuomalainenLatina

author: wang lei and liu yajie

editor: qin zhangyong

the ceo of the "most profitable" automobile group may have to be replaced.

the latest news is that john elkann, chairman of the stellantis group, has begun looking for a ceotang weishi's successor.

in other words, carlos tavares, who has served as ceo of stellantis group since its establishment, may lose his position.

however, stellantis officials also stated that this is part of the regular succession plan. because tang weishi's contract will expire in january 2026, it is not ruled out that carlos tavares will continue to serve as ceo.

but it is worth mentioning that since the beginning of this year, stellantis' financial report data has not been good, with a sharp decline, especially in the most profitablenorth american marketsuffered a waterloo.

now that the group has confirmed that it is looking for the next ceo, it probably means that the board of directors has reached an agreement for tang wei shi to step down.

will the boss of a car company, who has built stellantis into one of the most profitable car companies in the world, really retire at the peak of his career?

01

shareholders, unions, and dealers have all been offended

last year, stellantis was still a more profitable car company than volkswagen, mercedes-benz and bmw, and its net profit even swept all european car manufacturers, ranking first.

at that time, tang weishi was praised by many stars and said that he was "not completely satisfied" with this result. in the first half of this year, stellantis' net profit wasdown 48%, tang weishi also became the target of public criticism.

the reason for the sudden change in style is mainly because the company suffered a lot of setbacks in the most profitable north american market this year.

in the first half of this year, stellantis group's sales in the us market fell by nearly 16%, and its stock price has also fallen this year.more than one thirdthe decline in market share, high inventory, and quality issues have become the main reasons for the slowdown in sales in the north american market.

on september 10, u.s. dealer representatives sent tavares a strongly worded letter expressing their deep disappointment in him. the dealers specifically pointed out that the chrysler, dodge, jeep and ram brands were "rapidly deteriorating."

they believe that the price cuts and relaunch incentives introduced by the stellantis group to clear inventory are far from enough. the decision to reduce marketing funds and change dealer compensation policies will only make the situation worse and damage dealers' operating capabilities.

prior to this, stellantis was sued by american shareholders. the american shareholders who filed the lawsuit stated that stellantis deceived shareholders and concealed unfavorable conditions such as rising inventory.

the lawsuit alleges that stellantis spent much of 2024 making "extremely optimistic" assessments of inventory, pricing power, new products and operating margins.

but the financial report was not ideal. in the two trading days after the release of the first half financial report, stellantis' stock price in the united states fell 9.9% to us$17.66.tang weishi also became the defendant。

stellantis chairman john elkann has also grown increasingly unhappy with the situation in north america, according to people familiar with the matter. elkann is also the ceo of exor, stellantis' largest shareholder.

several executives have already left the group, and an heir to the chrysler family has announced his intention to buy back the brand from stellantis and lashed out at tavares and other executives.

as demand for electric vehicles weakens and chinese automakers' products are also popular in the european market, tavares has been forced to use tough measures such as strict cost cutting, delayed factory start-ups, firing union workers and offering buyouts to salaried employees.

when stellantis group said it planned to delay the reopening of a plant and a new electric vehicle battery plant in belvidere, illinois, shawn fain, president of the united auto workers (uaw), directlythreatening strike and calling for tavares to be fired。

fein believes that the poor sales are not due to the auto market. although stellantis' profits and sales have fallen sharply, gm and ford are doing well.

in addition, tang weishi gave himself a 56% salary increase, making himself the highest-paid traditional oem ceo in the world, which also made the uaw unhappy.

02

rumors of brand separation continue

let’s review the financial situation of the stellantis group. the change is indeed huge.

in 2023, stellantis group's operating profit was 24 billion euros and its net profit was 18.6 billion euros, once becomingeurope's most profitable car company。

although the company was successful last year, it experienced the "worst" half-year financial report in history in the first half of 2024.

in the first half of 2024, stellantis group achieved net revenue 85 billion euros, down 14% year-on-year, and achieved a net profit of 5.6 billion euros, down 48% year-on-year.

specifically, the decline in the north american market was even more obvious, with operating profit in the first half of this year being 4.366 billion euros, nearly halved from 8.027 billion euros in the same period last year.

as of the end of june, stellantis had more than 430,000 vehicles in inventory. in just one year, the company's cash flow plummeted from 13.39 billion euros to 4.89 billion euros, a drop of 1.3%63%。

in addition, the stellantis group has implementedasset-light business modelproblems also arose. in the first half of 2024, the combined shipments of stellantis group's joint ventures in china, india and the asia-pacific region were 32,000 units, a decrease of 90,000 units from the same period last year, a year-on-year decrease of 35.56%; shipments excluding joint ventures were 32,000 units, a year-on-year decrease of 44.83%.

in the first half of this year, stellantis group's net revenue in china, india and the asia-pacific region reached 1.072 billion euros, down 914 million euros from the same period last year, a decrease of 46.02%.

tang wei shi is over 60 years old, but he still has strong execution ability. he said that the group will take measures to optimize its brand portfolio and may sell or close some underperforming brands.

so there were rumors that stellantis was going to sell the super luxury brand maserati, and there were also rumors that "byd will acquire all assets of chrysler's three major brands: chrysler, dodge, and jeep."

although the sale of the above brands is fake news, stellantislayoffsbut it is true.

it was announced today that the company will cut 500 jobs at its light commercial vehicle plant in gliwice, poland, in order to adapt to difficult market conditions "exacerbated" by the eu's aggressive shift to electric vehicles.

in addition, stellantis is laying off nearly 200 people at its sterling heights assembly plant in suburban detroit, which produces the ram 1500, and 191 employees at its michigan truck plant in the united states.

despite the current grim situation, stellantis reiterated its 2024 guidance, including double-digit adjusted operating profit margin, positive industrial free cash flow, and the return of at least 7.7 billion euros of capital to investors in the form of dividends and buybacks.

the company said sales in august increased 21% from july, market share rose 0.7 percentage points, and inventory fell by about 10% for two consecutive months.

in the united states, stellantis' inventory of vehicles fell by 40,000 in july and august, and the company has set a target of 100 million vehicles by early next year.reduce inventory by 100,000 vehiclestargets, pledging to continue reducing inventories in september and throughout the year.

people familiar with the matter said that the stellantis group's board of directors will meet in the united states on october 9 and 10 to evaluate plans to turn around its north american business.

03

tang weishi, the "cunning"

because stellantis has an extremely low presence in china, many people in the country do not know its ceo (carlos tavares). in china, he has a more down-to-earth name, "tang wei shi".

speaking of tang weishi, many people call him the only "wolf warrior" in the european automotive industry, and some people say he is "profit-driven." but it has to be admitted that during his ten years in office, tang weishi did make stellantis one of the most profitable automakers in the world.

tavares is one of the very few leaders in the industry with a complete automotive background, including design, engineering, manufacturing and sales, and he is also a rally driver.

on april 1, 2014, tang wei shi was appointed as the president of psa peugeot citroen group, replacing philippe varin.european debt crisis。

later in 2021, he facilitated the merger of psa group and fca fiat chrysler group to form stellantis group, and tavares became the ceo of this world's fourth largest automobile group, which controls 14 automobile brands.

although it was ridiculed as a "weak alliance" at the time, under the leadership of tang wei shi, the operating performance of the stellantis group bucked the trend amid the downward trend in the global auto market, bringing real returns to the board of directors and investors.

in 2023, stellantis achieved a profit of 18.6 billion euros, distributed 7.7 billion euros to shareholders, and an operating profit margin of 13%, which puts the group among the ranks of high-end brands such as mercedes or bmw.far ahead of volkswagen, even ford and gm。

in fact, the record-breaking financial report data of stellantis after the merger was not driven by a substantial increase in sales, but by tang weishi's drastic "cost reduction", that is, to cut off some unprofitable or not very profitable vehicle models, and to increase the number of profitable projects.

this also made stellantis' attitude towards the chinese market ambiguous, and it even directly adopted a light asset strategy. except for the joint venture dongfeng peugeot citroen automobile co., ltd., other brands withdrew from china and chose to sell some high-profit imported niche models in china, such as jeep and alfa romeo.

moreover, tang wei shi did not give stellantis a chinese name like he did for himself.

this also led to the fact that although the global performance of stellantis, which he took over, was booming, its sales in china plummeted. in 2023, the sales of dongfeng peugeot citroen automobile, a joint venture between psa and dongfeng, were only 80,000 units, less than 10% of stellantis' global sales.1.5%。

interestingly, since tang wei shi merged psa and fca, he has never come to china again. it was not until october 26, 2023 that he appeared in hangzhou to acquire a stake in leapmotor.

obviously, tang wei shi, who is only interested in profit, began to look for opportunities to return to china after realizing that china has become a well-deserved "technological highland" and "cost lowland" in the new energy track.

at that time, stellantis spent 1.5 billion euros to buy 20% of leapmotor's shares and took two board seats, hoping to use leapmotor's new energy technology and china's new energy supply chain to accelerate the stellantis group's new energy transformation.

in addition, tang weishi also signed two cooperation agreements. stellantis has a 51% controlling stake in leapmotor international and exclusive sales agency rights outside greater china. this also means thatstellantis will become the biggest beneficiary of leapmotor's current overseas expansion。

being both swift and resolute and also able to get along with everyone, he seems to be a complex of contradictions. however, it is not difficult to find that there is an unchanging creed: interests determine stance.

the stellantis group, which has tasted the sweetness of light assets, is now facing a backlash in the north american market, which accounts for the majority of its profits. this is something that tang wei shi must solve next. as for whether it can be handled properly, it depends on whether the us market buys it.