Paris (AFP) – Stellantis, the carmaker which owns the Jeep, Peugeot, and Fiat brands, said Thursday that its sales fell 27 percent in the third quarter because of market difficulties in North America. The group stated it had trouble getting through stocks of vehicles in the United States and had been hit in Europe by the transition to new generation vehicles, with delays for new car launches, including the Citroen C3 and C3 Aircross. It reported delivering a fifth fewer vehicles than in the same quarter last year, also blaming “production gaps in several models as a global product transition begins…and headwinds from a challenging European market environment.”
In North America, its revenues collapsed by 42 percent to $13.47 billion due to a fall in sales and price cuts to clear its stock of vehicles. However, new finance chief Doug Ostermann remarked that while the “performance is below our potential,” the company was pleased with how they had “reduced meaningfully” their US stocks and “are on track for year-end targets.” Investors appeared to appreciate that message, with Stellantis shares up over three percent in pre-market trading. Analyst Marc Lavaud at asset manager Oddo BHF noted that the figures were in line with expectations and that the market had already been anticipating “very weak sales” in the quarter.
The bright spot was a 14 percent rise in sales in Latin America, driven by strong demand in Brazil and Argentina, Stellantis said. The group is counting on bouncing back as sales mount from some 20 new vehicles launched this year, including the new Peugeot 3008 — which it announced has 75,000 orders. It has also debuted a line of lower-priced electric cars in Europe with Chinese partner Leapmotor. A new wave of vehicles in North America is also set to come online soon, including the Jeep Wagoneer S and a new electric version of the Ram 1500 pickup.
Stellantis — which has a vast stable of 15 car brands — has hit a rough patch after years of record profits post its foundation in 2021 with the merger of PSA (Peugeot-Citroen) and FCA (Fiat-Chrysler). In September, it lowered its predictions for its operating margins from double figures to 5.5 to 7 percent for 2024 due to what it called a “deterioration” in the global car market and rising Chinese competition. However, Ostermann confirmed on Thursday Stellantis’s 2024 outlook and indicated that management intends to pay dividends to shareholders next year. “We’re going to be talking with the board about the right level of dividends next year,” he stated.
The carmaker separately indicated it had completed its planned 7.7-billion-euro ($8.4 billion) 2024 share buyback program in October. Since last month, Stellantis has announced the arrival of several new marketing executives as it tries to rev up its performance, and it revealed that its long-time chief executive Carlos Tavares will retire in 2026.
© 2024 AFP
