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Stellantis Made Record Profits Then Lost $26 Billion — Transcript

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0:00Do you know that Stellantis [music]
0:01reached a staggering inventory of
0:03430,000
0:05vehicles that buyers have completely
0:07ignored? This unsold mountain of cars
0:10has triggered a staggering 26.5 [music]
0:13billion-dollar loss. While Stellantis
0:16dumped a 4.1 billion-dollar stake in a
0:18battery [music] plant joint venture with
0:20LG Energy Solution for a symbolic $100.
0:24[music] Yet, in a twist that shocked
0:27industry observers, CEO Carlos Tavares
0:30walked away with a compensation package
0:32500 times [music] higher than the
0:34average Stellantis worker's salary. What
0:36exactly brought this automotive titan to
0:39[music] its knees?
0:41The financial collapse and crisis of
0:43Stellantis. By late 2024, an astonishing
0:47430,000
0:49unsold Stellantis [music] vehicles sat
0:51gathering dust in dealership lots across
0:53America. The conglomerate accounted for
0:56a massive 17% of total US auto industry
0:59inventory, despite [music] holding a
1:01mere 10% market share. At its core, the
1:04issue was a complete breakdown between
1:06its enterprise supply chain management,
1:08[music] the ERP, and SCM system, and
1:12real-world market demand. Management
1:14continuously pumped new vehicles out to
1:16dealers, inflating shipment figures to
1:19bolster sales reports, while actual
1:21retail sales ground to a halt under
1:23soaring price tags. A look at the
1:25average days on lot across key models
1:28lays bare the severity of the
1:30stagnation. The flagship Jeep Wagoneer,
1:33a high-margin SUV designed to be a cash
1:35cow, sat on dealer lots for an average
1:38of 137 days before finding a buyer. The
1:42flagship Ram 1500 pickup languished for
1:45131 days, while the Jeep Grand Cherokee
1:48trailed close behind at 111 days. It was
1:52not until late 2024 and throughout 2025
1:56that Stellantis, [music]
1:57desperate to clear lot space, burned
1:59through billions in aggressive
2:01incentives and deep discounts [music]
2:03just to flush out 100,000 units of
2:05bloated inventory. For an industry that
2:08relies entirely on capital turnover and
2:10tight supply chain optimization, these
2:13numbers were a slow-motion death
2:15sentence. Yet, the [music] rusting
2:17parking lots across America were merely
2:19the tip of the iceberg. As the financial
2:22veil was lifted, global investors and
2:25analysts [music] watched in shock at the
2:27sheer scale of the unraveling. In less
2:29than 2 years, between 65 billion euros
2:33and 70 billion euros in market value
2:36evaporated across stock exchanges, from
2:38Milan and Paris to New York. The company
2:41stock suffered a brutal, uninterrupted
2:44tailspin, plummeting nearly 80% from its
2:47all-time high. The [music] climax of
2:49this financial earthquake arrived with
2:51the official earnings release.
2:52>> [music]
2:53>> Stellantis posted a record-breaking net
2:55loss of 22.3 billion euros, roughly 26.5
3:00billion dollars for the full year.
3:02Industrial free cash flow swung deeply
3:04into negative [music] territory, burning
3:06through 4.5 billion euros. The
3:09overwhelming majority of this
3:11catastrophic loss stemmed from a massive
3:1425.4 billion euros asset impairment and
3:17write-down. Executive leadership
3:19conceded to a critical strategic
3:21blunder, grossly overestimating the pace
3:24of the EV transition. They poured
3:26capital into electric platforms just as
3:29consumer demand cooled, while
3:31simultaneously getting squeezed by
3:33shifting US emissions regulations under
3:35a changing administration. Meanwhile,
3:37Stellantis shares trading in Milan and
3:40New York took a punishing 80% hit from
3:42their early 2024 peak, wiping out
3:45roughly 65 to 70 billion euros in market
3:49capitalization. It was not just the
3:51largest loss in the company's history.
3:53It was one of the single largest annual
3:56losses ever recorded in the global
3:58automotive industry. How did a
3:59conglomerate once hailed as an
4:01unbeatable automotive empire whose
4:04margins were the envy of every
4:06competitor just 3 years earlier turn
4:09into a titan with feet of clay now
4:11fighting for its very survival. To
4:13understand the magnitude of this
4:15collapse, we cannot look solely at the
4:17dry accounting figures. We must rewind
4:20to where it all began. January 2021, the
4:23moment the historic merger was
4:25finalized.
4:27CEO Carlos Tavares' strategy and the
4:30fallout. In January 2021, the global
4:34automotive industry witnessed one of the
4:36largest mergers in corporate history.
4:38France's PSA Group, home to storied
4:41brands like Peugeot, Citroën, and Opel,
4:44joined forces with multinational giant
4:46Fiat Chrysler Automobiles. From this
4:48union, Stellantis was born. A mega
4:51corporation bringing 14 iconic
4:54automotive brands under a single roof.
4:56With a massive global footprint, a
4:58workforce hundreds of thousands strong,
5:01and consolidated revenue capable of
5:03rattling any competitor, the new empire
5:06took the world stage. At the helm of
5:08this behemoth stood chief executive
5:10officer Carlos Tavares. Across the
5:13automotive world, Tavares was viewed as
5:15a living legend. Cold, decisive, and
5:18uncompromising, he had previously
5:20accomplished the [music] unthinkable.
5:23Rescuing PSA from the brink of
5:25bankruptcy and turning the hemorrhaging
5:27Opel brand into [music] a
5:28cash-generating machine. Upon taking
5:30control of Stellantis, Tavares' mandate
5:33was simple. Transform [music] this
5:3514-brand conglomerate into the single
5:37most profitable automotive powerhouse on
5:40Earth. Tavares' strategy was
5:42straightforward yet ruthless. Maximize
5:45profit margins at all costs. No
5:47compromises, no discounts, and the
5:50[music] absolute elimination of
5:52affordable mass-market vehicles, models
5:54he viewed as brand diluting and margin
5:56eroding. If a model failed to generate
5:59substantial margins, it was killed off
6:01without hesitation. Right on cue, the
6:04global COVID-19 pandemic swept the
6:07world, unintentionally serving as the
6:09ultimate [music] catalyst for Tavares's
6:11doctrine. Global supply chains fractured
6:14and a severe semiconductor shortage
6:16brought automotive assembly [music]
6:17lines worldwide to a grinding halt.
6:20While competing automakers panicked,
6:22Tavares saw a golden opportunity. When
6:25supply is scarce, the seller dictates
6:28the [music] price. Tavares immediately
6:30gutted global incentive schemes and
6:32pushed retail prices to unprecedented
6:35heights. He directed all production
6:37capacity toward top-tier, high-margin
6:39vehicles. Take the Jeep Wrangler, once
6:42an affordable off-roader beloved by the
6:45American middle class, whose price was
6:47jacked up by more than 30% in short
6:50order. At the same time, entry-level
6:52gateway models in the US market were
6:54ruthlessly axed. The Jeep Renegade was
6:57discontinued, and the legendary Chrysler
6:59300 sedan was killed off entirely.
7:02Initially, this game plan looked like an
7:05economic miracle. Stellantis's 2023
7:08financial report stunned the industry.
7:11Net revenue reached nearly 190 billion
7:14euros. Net profit hit a record-breaking
7:1718.6 billion euros, and adjusted
7:20operating margins reached an
7:21extraordinary 12.9%,
7:24an unheard-of figure for a volume
7:26automaker. Behind that gleaming wall of
7:29financial metrics, however, a ticking
7:31time bomb was already armed. Tavares had
7:34not simply raised vehicle prices. He had
7:37directly driven his core customer base
7:39away. Loyal, price-sensitive buyers
7:42across Jeep, Ram, and Chrysler American
7:44families who had stood [music] by these
7:46brands for generations suddenly realized
7:49they were no longer willing or able
7:50[music] to shell out exorbitant prices
7:53for these vehicles, and so they quietly
7:55walked away. One by one, they defected
7:58to Toyota, Honda, and Hyundai.
8:01Stellantis' US market share suffered a
8:03devastating collapse, plummeting from
8:0611.6%
8:07in 2021 down to a mere 8% in 2024. For
8:12the first time in history, Stellantis
8:14was overtaken by Honda on American soil.
8:17At the exact same time, Tavares faced a
8:20second compounding pressure, the
8:22European Union's strict CO2 emissions
8:25mandates. Starting in 2025, fleet-wide
8:29average emissions for new passenger
8:30vehicles in Europe could not exceed 93.6
8:34g of CO2 per kilometer.
8:36Desperate to avoid staggering financial
8:39penalties, Tavares announced a massive
8:4130 billion euros EV investment plan
8:44through 2030, committing to transform
8:47Stellantis into a 100% electric lineup
8:50in Europe and 50% in the United States.
8:53Yet, this shift was never born out of a
8:55genuine understanding of market demand.
8:58It was a desperate retreat from
8:59regulatory fines. Gambling tens of
9:02billions of euros on a technology that
9:04consumers were not yet ready to adopt at
9:07the forced pace turned out to be a dead
9:09end. EV rollouts severe delays. While
9:13those models that did make it to market
9:15were plagued by embarrassing defects.
9:17Case in point, the Citroen EC4. The
9:20company's crucial mainstream electric
9:23offering was delayed by months and
9:25crippled by severe software glitches,
9:27turning its initial rollout into a
9:29public relations disaster. Meanwhile, a
9:32high-profile software partnership with
9:34Amazon was quietly scrapped after three
9:37fruitless years and their heavily hyped
9:39level three [music] autonomous driving
9:41system was killed off entirely. As the
9:44cracks turned into fissures, rather than
9:46recalibrating his strategy, Tavares
9:49responded by purging anyone who dared
9:51question his leadership. In 2024 alone,
9:54Stellantis [music]
9:55saw a high-profile exodus. Its chief
9:58financial officer, head of Europe,
9:59[music] head of North America, and a
10:02suite of top-tier executives all walked
10:04out the door. Internally,
10:06>> [music]
10:06>> dissent was completely forbidden. On
10:09September 10th, 2024, the Stellantis
10:12National Dealer Council in the US took a
10:14step unprecedented in automotive
10:16history.
10:17They penned an open letter addressed
10:19directly to Tavares. Signed by Council
10:22Chairman Kevin Farrish, the letter
10:24publicly indicted the CEO for reckless
10:27short-term decision-making aimed at
10:29pumping immediate profits at the expense
10:31of devastating the dealer network and
10:33eroding brands built over generations.
10:36The letter bitingly pointed out [music]
10:38that while the dealer body was
10:39suffocating, Tavares was pocketing a
10:42record 36.5 million euros compensation
10:45package, [music]
10:46roughly 40 million dollars, for 2023,
10:49over 518 times the salary of the average
10:53Stellantis employee. On September 30th,
10:552024, Stellantis issued an emergency
10:59profit warning. Operating margins were
11:01slashed from double-digit [music]
11:02projections down to a grim 5.5% to 7%
11:07while industrial free cash flow was
11:09projected to plunge negative [music] to
11:11the tune of 10 billion euros. The stock
11:14crashed instantaneously. Facing an
11:16unmitigated disaster, Chairman John
11:19Elkann, scion of Italy's powerful
11:22Agnelli dynasty, slammed on the
11:24emergency brakes. On December 1st, 2024,
11:28Carlos Tavares announced his immediate
11:30resignation.
11:31Tavares exited the building having
11:33pocketed well over 102 million euros
11:36across his four-year tenure, along with
11:39roughly [music] 12 million euros in
11:41severance for 2025. Left in his wake
11:44were shuttered and idling factories from
11:46Opel's historic Eisenach plant in
11:48Germany, which eliminated 1,100 jobs, to
11:52Fiat's iconic Mirafiori plant in Italy,
11:55whose assembly lines ground to a near
11:57total halt producing fewer than 30,000
12:00units in all of 2024.
12:03Reconstruction efforts under new CEO,
12:06Antonio Filosa. Stepping into the hot
12:09seat to replace Tavares was Antonio
12:11Filosa. Far from a desk-bound executive
12:14hailing from Paris or Turin, Filosa was
12:17a battle-tested field leader who had
12:19previously held the Jeep brand and
12:21directed Stellantis's entire North
12:23American footprint. He understood every
12:26square foot of the abandoned dealer lots
12:28and knew precisely what had drained the
12:30lifeblood from the conglomerate.
12:32Inheriting a Stellantis in freefall,
12:35Filosa's first major move was to lay
12:37bare the harsh financial reality, a
12:40staggering 22.3 billion euros net loss
12:43for 2025.
12:45To clean up the wreckage left behind by
12:47his predecessor, Filosa wielded a
12:49ruthless accounting sledgehammer,
12:52writing down 8.5 billion euros for
12:55unwanted EV platforms and burning
12:57through an additional 6.5 billion euros
13:00in cash penalties to suppliers for
13:02abruptly canceling prior component
13:04orders. A quintessential symbol of this
13:06catastrophic waste was the fate of the
13:09Canadian battery plant. Built in 2022
13:12alongside joint venture partner LG
13:14Energy Solution with a total investment
13:17of 4.1 billion dollars, Stellantis was
13:20forced four years later to sell off its
13:23entire stake for a symbolic 100 dollars.
13:26With the balance sheet scrubbed clean,
13:29Filosa immediately launched a campaign
13:31to dismantle Tavares' playbook, making
13:34the North American market top priority.
13:36In October 2025, Stellantis announced a
13:39colossal $13 billion investment in the
13:43United States over 4 years. The single
13:46largest investment in the company's
13:48100-year history in the American market.
13:51This capital injection was deployed to
13:53deliver a portfolio that systematic ally
13:55restored what Tavares had stripped away.
13:58Developing five brand new models,
14:00creating over 5,000 new jobs, and
14:03boosting US production capacity by 50%.
14:06The Belvidere Assembly Plant in
14:07Illinois, idle under Tavares' watch, was
14:10injected with over $600 million to
14:13restart operations. Starting in 2027,
14:16the facility will assemble the next
14:18generation Jeep Cherokee and Jeep
14:20Compass sub-$40,000 SUVs built
14:24specifically to win back buyers who had
14:26defected to Toyota and Honda. The
14:28revival of the Jeep Cherokee marks the
14:30brand's return to the mid-size SUV
14:33segment, the largest and most fiercely
14:35contested space in the US auto market.
14:38Simultaneously, management made a deeply
14:40symbolic gesture, bringing back the
14:43iconic [music] 5.7-liter Hemi V8 engine
14:46to the Ram 1500 lineup in 2026, [music]
14:49replacing the forced six-cylinder
14:51powertrains Tavares had pushed. While a
14:54small technical adjustment on paper, it
14:56sent an undeniable signal to loyal Ram
14:59owners. We were wrong, and we are
15:01listening again. Yet, turning the ship
15:04around was far from smooth sailing. To
15:06consolidate production inside the United
15:09States, Filosa pulled planned Jeep
15:11manufacturing from the Brampton Assembly
15:13Plant in Canada. The move exploded into
15:16a high-level diplomatic rift. Canada's
15:19Minister of Industry penned a scathing
15:21letter of protest, accusing Stellantis
15:24of reneging on production commitments
15:25tied to federal subsidies. Fixing a
15:28derailed industrial titan is never a
15:31painless endeavor.
15:33The grand picture and future challenges.
15:36Entering September and October of 2026,
15:39the deep reconstruction strategy, dubbed
15:41Fast Lane 2030, under the stewardship of
15:44new CEO Antonio Filosa, has yielded its
15:48first sweet fruits, [music]
15:49as evidenced by a series of remarkably
15:51optimistic growth metrics. The third
15:54quarter 2026 earnings report, published
15:56in early October, revealed that
15:58Stellantis has halted its protracted
16:00downturn, recording cumulative sales for
16:03the first 9 months of 2026 in the
16:05strategic United States market of
16:08958,463
16:11vehicles, a 3% increase compared to the
16:14same period in 2025.
16:16In the third quarter of 2026 alone,
16:19total deliveries achieved solid
16:21stability [music]
16:21at 324,277
16:25units. The brightest spot stemmed from
16:27the flagship Ram truck brand, which
16:29logged explosive retail sales growth of
16:3242% for the Ram 1500 lineup, helping
16:35total Ram brand shipments climb 29%.
16:39Furthermore, Dodge Durango sales rose
16:4118%. The Grand Wagoneer grew 14%,
16:44>> [music]
16:45>> and the Chrysler Pacifica ticked up 7%,
16:48signaling a robust revival in real
16:50[music] purchasing demand among American
16:52consumers. This turnaround was not
16:54confined to North America, but spread
16:56across key international markets as
16:58well. In Europe, an early October 2026
17:02report from the FIM-CISL trade union
17:05confirmed that Stellantis' [music]
17:06manufacturing output in Italy staged a
17:09strong recovery after two consecutive
17:12years of decline, reaching 340,745
17:16vehicles over the first 9 months, a
17:19soaring 28% [music]
17:20jump year-over-year, propelled by strong
17:23demand for new models like the Jeep
17:25Compass and the Fiat 500 Hybrid. On the
17:28financial front, comprehensive
17:30restructuring efforts catalyzed a
17:31dramatic acceleration in the most recent
17:34quarter, with consolidated net revenue
17:36reaching 43.5 billion euros, [music]
17:39a 13% increase, pushing adjusted
17:42operating margin to 1.8%
17:45and delivering a net profit of 300
17:47million euros, marking an impressive
17:50reversal from the loss recorded in the
17:52same period last year. Through
17:53disciplined inventory control and supply
17:56chain optimization, spearheaded by over
17:5850 quality war rooms, Stellantis
18:01engineered a dramatic turnaround in
18:03industrial free cash flow, driving the
18:05metric into positive territory at 1.0
18:09billion euros. The conglomerate
18:11currently maintains a massive liquidity
18:13cushion of 44.1 billion euros,
18:16bolstering its financial footing ahead
18:18of a major production ramp-up planned
18:20for the fourth quarter of 2026. Though
18:23the broader market continues to present
18:25headwinds, the Stellantis of Q4 2026
18:28stands on a healthy, authentic, and
18:30energizing platform for [music]
18:32recovery.
18:33In short, Stellantis stands today as a
18:36volatile battleground, a new CEO racing
18:39to undo past blunders by resurrecting
18:42affordable cars and V8 engines, a
18:44promising strategic alliance with
18:46Chinese EV maker Leapmotor, and [music]
18:49three major nations pulling the
18:51conglomerate in completely different
18:53directions. Those record-breaking
18:55profits of the past were nothing more
18:57than a loan borrowed from the future,
18:59and now Stellantis is paying a steep
19:02price. Can this multinational automotive
19:04titan weather the storm and pull off a
19:06miraculous revival, or will [music] it
19:09sink deeper into crisis? Only time will
19:11tell. If you found this video
19:13insightful, don't forget to hit the like
19:15button, subscribe to the channel, and
19:17turn on the notification bell so you
19:19never miss our upcoming deep dives into
19:22the world of business and automotive
19:23history. What's your take on the future
19:25of Stellantis? Let us know in the
19:27comments below. Thank you so much for
19:30watching. Goodbye, and see you in the
19:32next video.

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