After Tavares’ farewell, U.S. market recovery continues to be in trouble. The Stellantis automotive group has been going through a deep crisis for some time now. The farewell of Carlos Tavares, former CEO, has left a decidedly difficult legacy to manage. Indeed, we are talking about controversial strategic decisions, a decline in the competitiveness of some historical brands, and a general situation of great uncertainty within the company. At the helm now is John Elkann, who has been trying to turn around the fortunes of a group that includes such globally important brands as Fiat, Jeep, Alfa Romeo and many others.
Elkann was called upon to solve post-Tavares problems
Former CEO Carlos Tavares left a particularly contentious situation at Stellantis, unleashing a management chaos that forced the company to review some of its most important strategic decisions internationally. Now at the helm of the large automotive company is John Elkann, Gianni Agnelli’s grandson, who has now found himself taking on the dual role of chairman and CEO.
With the strong consensus of the Board of Directors, Tavares’ resignation became effective immediately, proclaiming Elkann as head of everything with full power to manage a conglomerate of particularly infamous brands around the world, e.g., Fiat, Jeep, Alfa Romeo, Maserati and Peugeot, Dodge and RAM among others.
Elkann, former chairman of Ferrari and leader of Exor, now faces very difficult challenges, inheriting a situation that many Stellantis observers describe as critical, or even worse probably. Under the previous management, some brands were affected by a major loss of competitiveness, especially in the North American market, one of the most important for Stellantis, where the decline of historic brands such as RAM and Dodge was particularly evident.
One of the major changes was the return of Kuniskis
Just to try to get around this crisis, RAM has recalled Tim Kuniskis, one of its most experienced managers who has executed major operations in the past and, of course, already known for relaunching Dodge on other occasions, to lead the main ones. Kuniskis makes no secret of the difficulty of the task, but says he is ready to fight and “work his butt off” to restore the brands under his management to their former glory. Among the thorniest issues is the phasing out of HEMI V8 engines, an unpopular decision that many attribute to Tavares’ policies, accused of putting cost containment before quality and innovation in the Stellantis group. This approach would have led to a 14 percent workforce cut from 2020 and the simplification of some models, making them less competitive with competitors.
Stellantis crisis, as we know, does not only affect American brands but extends practically internationally, obviously taking as reference all the markets where the automotive group is currently operating that its many brands. The blockade of PureTech engines has also negatively affected the group’s reputation and sales, adding further pressure on Elkann and his team. Although the situation is not exactly positive, the new course at least aims to reverse the trend, with a vision that should be more balanced between profitability and product enhancement.