DETROIT, Oct 10 (Askume) – Chrysler parent company Stellantis (STLAM.MI) confirmed on Thursday that Chief Executive Carlos Tavares will retire at the end of his contract in early 2026, and announced a major senior management change to spearhead lagging North American operations.
Profits and sales at the French-Italian automaker’s traditional profit engine are falling, forcing it to cut its 2024 profit forecast last week and signal it could cut dividends and share buybacks next year.
Analysts have downgraded the company’s shares , which have fallen 42% this year, as it falters in North America, where sales of popular products such as Jeep and Ram trucks typically provide the bulk of the company’s profits.
As soon as Tavares’ plans to retire were confirmed, Strantis said a search for his successor was underway, though it said at the time that it was likely he would stay on beyond the end of his contract. The world’s fourth-largest automaker by sales said it now plans to name his successor by the fourth quarter of 2025.
Stellantis appointed Doug Osterman, the former chief operating officer of its China unit, as chief financial officer, replacing Natalie Knight, who is leaving the company.
In addition to serving as chief executive of the Jeep brand, the automaker appointed Antonio Filosa as chief operating officer of North America, replacing Carlos Zarlenga, whose future role has not yet been announced.
Tavares, an avid race car driver credited with building Stellantis into one of the world’s most profitable automakers over the years, will take over through the company’s 2021 merger with Fiat Chrysler and Peugeot maker PSA.
But the company’s stock price has soared and profits have fallen in recent months, worrying industry observers after years of huge profits that were the envy of rivals in Detroit and abroad.
“The company spent much of the past 12 months trying to assuage investor concerns about U.S. inventories and discounts, but its position weakened after it cut guidance in late September,” Bernstein analysts said in a note.
“Today’s management reshuffle adds to a growing list of senior management changes (21 in the last 12 months) and is unlikely to alleviate investors’ concerns,” he said.
Stellantis last week revised its cash flow forecast for this year from a positive cash outflow to a negative cash flow of between 5 billion and 10 billion euros ($5.5 billion to $10.9 billion).
Tavares had previously said the group’s 14 brands, including Maserati, Fiat, Peugeot and Jeep, were portfolio assets for Stellantis, but he said in July that underperforming brands could be divested to cut costs .
he facesNoting intensifying competition from Chinese electric vehicle makers , which are expanding their market share in Europe, he said that to beat these competitors, Stellantis must “strive to become Chinese itself “.
Stellantis is working to rapidly increase sales of its electric models, aiming to achieve 100% of its passenger car sales in Europe and 50% of its passenger car and light truck sales in the United States by 2030. The company plans to launch 75 electric models globally during this time.
Tavares faces intense criticism from the United Auto Workers , dealers , and shareholders as the automaker attempts to sharpen its strategy and improve its financial health.
In a statement Thursday, he said the sweeping management overhaul was designed to address those concerns.
“In the Darwinian era of the automotive industry, it is our responsibility and moral duty to prepare for the future,” he said.
In addition to the management changes, Stellantis also changed its structure and moved the supply chain organization into the manufacturing department to focus more on improving supplier performance.
When asked for comment, a UAW representative sent a link to a union website that showed Tavares in a trash can and at the top of a list of criticisms from the labor group.
Unions are preparing to launch a nationwide strike against the automaker, accusing it of failing to deliver last year’s performance
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