Stellantis shares dropped sharply on Monday after it was reported that CEO Carlos Tavares had quit as leader of Europe’s second-largest car company. This came after a big drop in sales for the Jeep and Renault maker.
Stellantis said in a statement on Sunday that Tavares’ exit had been accepted by the board and would take effect right away. The carmaker also said that it planned to hire a new CEO by the first half of 2025.
On Monday, Stellantis STLAM -9.03% STLA 3.21% shares on the Borsa Italiana stock exchange in Milan fell 8%. They have now lost 46% so far in 2024 due to a big drop in sales across the board in the company’s two main markets, Europe and North America.
Stellantis senior independent director Henri de Castries said Tavares quit without warning because the CEO’s ideas about the company’s plan were different from those of the board and shareholders.
“Stellantis’s success since the beginning has been built on the reference shareholders, the board, and the CEO working together perfectly.” But in the past few weeks, different points of view have come to light, which is why the board and the CEO made this choice today, de Castries said.
According to reports in the press, Tavares may have quit suddenly because he and the board didn’t agree on things like “the collapse in sales, the strategy on electric [and] the discontinuation of some models without being replaced.” Martino De Ambroggi leads Equita’s analysts in this research.
Stellantis’ sales have dropped sharply over the past few months, which led to Tavares’ departure. Companies said their third-quarter sales dropped 27% to €33 billion. They said this was because they sent fewer goods to Europe and North America.
Citi experts said Stellantis’s business is facing big problems, such as a drop in the car market and more competition from Chinese companies.
Equita analysts also said, “Tavares’ resignation creates uncertainty at a particularly critical moment.” This is because the company is having to deal with the threat of possible tariffs from the U.S., delays in the release of new models, and efforts to reduce its North American inventory.
Prior to stepping down, Tavares had been CEO of Stellantis since January 2021, when the company was formed when PSA Group and Fiat Chrysler Automobiles merged.
Before becoming CEO of Renault’s parent company PSA Group in 2014, 66-year-old Tavares started his career at the French car business.
Stellantis had said before that it “unanimously supported Carlos Tavares” and that the CEO would stay in his job until the end of his contract in early 2026.
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