Carlos Tavares resigned with immediate effect as CEO of Stellantis on December 1, 2024, almost 18 months before his contract expired: now the revolution under John Elkann‘s leadership includes five moves. While searching for a new CEO, the company is managed by an interim executive committee.
John Elkann revolutionizes Stellantis after Carlos Tavares’ resignation
The company has seen vehicle production plummet both in Italy and the United States, where a series of layoffs have also been announced in recent months. One of the commitments is to increase production and protect jobs, in exchange for government support for the electric transition.
Less than a week after Tavares’ resignation, Stellantis stated that it would rejoin the Acea association. Tavares decided to leave in 2023 after a series of controversies. The automotive group plans to align with the group’s proposals, stated the company’s head for Europe Jean-Philippe Imparato last week. The Portuguese manager had opposed Acea’s request for concessions on the interim targets of the European Union’s carbon emission reduction goals, under which companies risk fines of minimum 15 billion euros, with a maximum of 18 billion. Elkann’s idea appears to be having a more collegial management during this phase. With greater attention to top executives, their role and their competencies, compared to the previous one-man-only style under Tavares. In short, an interim executive team.
There was tension between dealers and Tavares. Whose position was not supported by Stellantis European dealer associations, who were instead in favor of the Acea proposal. Now things are changing: “Cooperation is strong and we are confident we can face future challenges with our partner.” Alberto Di Tanno, president of the Italian dealership group Intergea, is confident: “It seems the company wants to present itself as less centralized and give more autonomy to its national structures, including in relationships with dealers,” he stated.
Tavares, an industry veteran who had led Stellantis since its creation in 2021 through the merger of PSA and Fiat-Chrysler, had been celebrated for increasing operating margins. After cuts years ago in PSA. However, dealerships on both sides of the Atlantic had complained about the increase in prices for mass-market brands. Combined with inflation, it created a terrible mix. Now, they will try to remedy as much as possible. The trouble is Jeep, former golden goose. In the past, it was known for an exceptional quality-to-price ratio. But then prices shot up to premium brand levels, and that was the end. This month Stellantis quickly rehired retired executive Tim Kuniskis to lead Ram, one of its most important brands. The target is to reverse the brand’s sales in the United States, which were down 24% this year at the end of the third quarter.
Kevin Farrish, leader of Stellantis’ dealer council, stated that Elkann met with their executive council in the United States in early December to discuss how the automaker can better revise its relationship with dealers. Elkann said that Antonio Filosa, appointed head of North American operations in October, would have the authority to respond to market conditions. “It meant a lot to us. We have a lot of opportunities to fix what Mr. Tavares damaged.” Santosh Viswanathan, who owns a Stellantis dealership in Delaware, said Elkann’s first actions are promising: “The dealer body, which is your distribution channel, was left in tatters.”
After falling to their lowest (since July 2022) on December 2, 2024, following the news of Tavares’ resignation, Stellantis shares bounced back by over 18%: they had plunged by more than 40% since the beginning of the year. Andrea Scauri, Swiss fund manager at Lemanik, stated that the entire automotive sector will benefit from a softer EU approach on carbon emission regulations, including potential fines on 2025 interim targets. “Tavares denied this was an issue. Acknowledging that there can be risks, and thus having more constructive relationships with politics at national and EU level, should help.”