Stellantis announced Tuesday that the company is taking steps to prepare for the tariff increase scheduled for April by moving additional parts and components to its factories located in the United States.
Stellantis: strategies to adapt to new U.S. duties
In response to the impending tariff increase scheduled for April, Stellantis announced a series of strategic measures aimed at minimizing the economic impact on distributors and suppliers in the United States. Chief Financial Officer Doug Ostermann confirmed that the company is actively reorganizing its supply chain, moving the production of additional parts and components to U.S. plants.
At the same time, Stellantis is accelerating production of models particularly in demand by dealers, manufactured in Canada and Mexico. The goal is to ensure consistent and timely supply, anticipating potential disruptions caused by new duties. This proactive strategy allows the company to respond with agility to market fluctuations, ensuring that dealers can supply their lots without delay.
Collaboration with distributors and suppliers is at the heart of Stellantis’ strategy. The company is working closely with its partners to optimize logistics and distribution, ensuring that all players in the supply chain are ready to meet new challenges. This synergistic approach is key to maintaining efficiency and competitiveness in a rapidly changing economic environment.
Supply chain optimization
Chief Financial Officer Doug Ostermann stressed that this move, although not the company’s normal operations, is necessary to mitigate the impact of the tariffs. Ostermann highlighted the importance of working with suppliers to accumulate parts potentially subject to tariffs. This strategy allows Stellantis to ensure continuity of production and avoid disruptions in the supply chain.
“This is not how we would normally operate,” said Chief Financial Officer Doug Ostermann, speaking of working with suppliers to accumulate parts that might be subject to tariffs. “But to mitigate any short-term impact, we have taken some measures.”
During the Wolfe Research Virtual Autos Summit, Ostermann discussed Stellantis’ strategies to overcome the challenges of 2024. These include launching new products and revamped models later this year. The company is focusing on innovation and adapting to changing market conditions to strengthen its position in the automotive industry.
Stellantis strategy for the North American market
Doug Ostermann revealed that Stellantis has effectively navigated initial tariff disruptions through solid vehicle inventory management in the United States. The company benefits from an ample supply of vehicles produced in Canada and Mexico, with inventories currently covering a 70-80 day period at dealers.
Stellantis continues to actively engage in dialogue with the Trump administration, reaffirming its commitment to strengthening domestic production. The company has demonstrated this commitment with significant investments since Trump’s inauguration. However, Stellantis executives have expressed concern about the new tariff policies, stressing the need to avoid unwarranted advantages for foreign competitors, particularly those with a low percentage of U.S.-manufactured components.
Stellantis’ strategy focuses on introducing revamped and completely new models to dealers, with the goal of regaining lost market share in North America. The company focuses on innovation and product quality to consolidate its position in the automotive market.