Stellantis issued a cautionary statement on Tuesday, anticipating a financial impact of 1.5 billion euros (approximately $2.4 billion Cdn) due to U.S. tariffs for this year. The company, under the leadership of new CEO Antonio Filosa, aims to revamp its operations following a challenging 2024 by introducing new vehicle models to cater to customer preferences.
During his initial public address as CEO, Filosa emphasized the importance of regaining momentum in sales volume. He highlighted plans to enhance their product lineup by reintroducing the popular Hemi eight-cylinder engine for Ram trucks in response to market demands. The market response was positive, with Stellantis’ Milan-listed shares bouncing back up to 3.8% post-Filosa’s briefing with analysts, eventually closing 0.2% higher.
Looking ahead, Stellantis foresees a low-single-digit margin in adjusted operating income for the latter half of 2025 after a challenging first half. Filosa acknowledged that significant efforts are required to enhance their product offerings, especially targeting segments where they have been less present, alluding to the V8 Ram as a starting point.
Filosa, who assumed the CEO role in May following the departure of Carlos Tavares, emphasized the importance of accountability over assigning blame during discussions with analysts. The company’s outlook for the second half of the year includes projections of increased net revenues and improved industrial free cash flow compared to the initial half, during which they experienced a cash burn of nearly $4.8 billion.
The 1.5-billion-euro impact from tariffs, with 300 million euros incurred in the first half, falls within the previously provided forecast range of 1.0 billion to 1.5 billion euros. The company’s decision-making is currently influenced by the tariff regulations outlined in the recent EU-U.S. trade agreement reached over the weekend.
When asked about potential streamlining of Stellantis’ diverse portfolio of 15 brands, Filosa emphasized the strength and competitiveness it provides against industry rivals. He expressed the company’s commitment to enhancing efficiency in managing its brand portfolio effectively.
Stellantis had withdrawn its earlier projections for a moderate recovery in 2025 due to the uncertainties surrounding U.S. tariffs, following a substantial 70% drop in net profit in 2024. The recent EU-U.S. trade agreement, which imposed a 15% U.S. import tariff on most EU goods, has a significant impact on Stellantis due to the heightened tariffs on imports from Mexico and Canada, which constitute over 40% of the vehicles sold in the U.S. last year.
