MILAN/DETROIT - Stellantis chief executive Carlos Tavares resigned abruptly on Dec 1, two months after a profit warning at the maker of Jeep, Fiat and Peugeot cars that has lost around 40 per cent of its value in 2024.
The company said it would seek to find a replacement CEO in the first half of 2025. Senior Independent Director Henri de Castries stated that Mr Tavares' departure resulted from differing views among major shareholders, the board, and Mr Tavares himself.
"The Company's Board of Directors, under the Chairmanship of John Elkann, accepted Carlos Tavares' resignation today from his role as chief executive officer with immediate effect," Stellantis said in a statement.
Mr Elkann thanked Mr Tavares for his role in creating Stellantis, the world's fourth-largest carmaker by sales. Other big shareholders include the Peugeot family and the French government through public investment bank BPI France.
Previously regarded as one of the most respected executives in the auto industry, Mr Tavares faced criticism after Stellantis issued a profit warning on its 2024 results. This included a forecast for a cash burn of up to 10 billion euros (S$14.16 billion), primarily due to slow sales and bloating inventories in North America.
The warning triggered significant management changes within Stellantis but initially spared Mr Tavares. However, he later announced he was not seeking a new CEO term and would retire at the end of his current mandate in early 2026.
"Tavares is leaving behind a mess of painful layoffs and overpriced vehicles sitting on dealership lots," UAW President Shawn Fain said. "We look forward to new Stellantis leadership that respects hardworking UAW members."
Stellantis shares have lost about 40 per cent of their value this year while US rival Ford Motor's shares are down by seven per cent and General Motors' shares are up by fifty-five per cent.
The process to appoint a new permanent CEO is underway and will accelerate to conclude within the first half of 2025. Meanwhile, an interim executive committee chaired by Mr Elkann will be established.
"There is too much pressure on Stellantis' management," said Fabio Caldato from AcomeA SGR. "New ideas and fresh forces are needed."
Stellantis dealers have expressed displeasure over inventory issues leading to decreased sales across brands like Dodge, Ram, Jeep, and Chrysler. Sales through Q3 were down seventeen per cent compared with last year’s period.