According to recent rumors, Stellantis CEO Carlos Tavares is preparing a significant management reshuffle in response to a serious profit warning that has hit the automotive group in 2024. Tavares is expected to present his proposal during a board meeting in the United States this week. The cuts could affect various sectors of the company, including financial departments, regional managers, and brand executives, as part of a broader strategy to address the difficulties.
Carlos Tavares is preparing a significant management reshuffle in response to Stellantis’ serious profit warning
During the two-day meeting, board members will also discuss the future of CEO Carlos Tavares, who recently stated he might retire at the end of his term. This meeting was scheduled last month, before Chairman John Elkann had begun the search for a possible successor to Tavares.
Carlos Tavares, known for his cost-cutting attitude, is trying to regain control after months of difficulties that forced Stellantis to revise downwards its profit and cash flow forecasts for 2024. While most European competitors face a decline in demand, the severity and timing of Stellantis’ profit warning have raised doubts about the management of the automotive group.
It’s unclear whether the board will approve the restructuring plan proposed by CEO Carlos Tavares, as there are several possible outcomes, according to sources. During the meeting, board members will also focus on the restructuring efforts planned in the United States, Stellantis’ main profit market. After the announcement of possible restructurings, Stellantis’ U.S. shares saw an increase, rising up to 3.2 percent, although the stock has lost about 42 percent in 2024.
The Stellantis group is facing excess inventory, high-profile executive departures, and declining sales in the United States, complicated by prices higher than those of competitors, as also stated by automakers, some forced to close. According to Bloomberg‘s report last month, Chairman John Elkann is increasingly dissatisfied with the situation in the North American market.
After his appearance before the board, Carlos Tavares will travel to Italy, where he will speak at a parliamentary hearing, following concerns about the decline in automotive production in the country. During a visit to the Sochaux plant in France last week, Tavares took a defiant tone and stated that he will respect his mandate until the end and that the current headwinds “do not in any way” call into question his strategy.