Stellantis has thousands of unsold cars in the stores, and this is no secret. In light of the revised profit estimates for this year, the situation is becoming increasingly complicated in the United States for the company. The automotive Group, which, among others, makes decisions for Chrysler and Jeep, announced today that it wants to accelerate inventory reduction after drastically lowering its forecasts.
Stellantis has too much car inventory in the United States: incentives and discounts coming soon
The automotive group, which controls important brands worldwide such as Ram and Fiat, has declared its intention to bring forward the goal of reducing inventory in the United States to no more than 330,000 vehicles by the end of the year. Chrysler and Jeep will be the main car manufacturers affected by this desperate inventory reduction, thus selling as many stocks as possible in the United States. The stated objective refers to a rather urgent reduction, brought forward compared to the previous decision related to the first quarter of 2025.
Stellantis, as already declared, expects a reduction in shipments to North America of over 200,000 units in the second half of 2024, doubling the initial estimate of 100,000 vehicles. To this end, it will increase incentives on 2024 models and older ones, and cut both costs and production capacity. All these chain effects are due to growing competition, both from Chinese manufacturers and from a greater general supply in the sector.
Patrick Hummel, a UBS analyst, commented that while Stellantis’ negative profit communication was not entirely unexpected, its magnitude was. In fact, Hummel believes that the sector’s earnings estimates are still overestimated by about 40%.
Stellantis shares, listed in Europe, lost 12%, with an overall decline of 50% compared to the March 2024 peak. These developments come at a time of uncertainty, with an imminent possible strike by the United Automobile Workers (UAW), and after Stellantis hinted that it could be looking for a successor to the current CEO, Carlos Tavares, whose contract will expire in 2026.