Stellantis vows to reconnect with customers as it flags $2.4B Cdn tariff hit for 2025

CBC

5 days ago

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Stellantis warned on Tuesday of a 1.5-billion euro (nearly $2.4-billion Cdn) hit from U.S. tariffs this year, but pledged new vehicle launches to reconnect with customers as its new CEO tries to get the automaker back on track after a dismal 2024.
In his first public appearance as CEO, company veteran Antonio Filosa said the priority was to return to volume growth.
"That means ... the expansion of our lineup with the addition of new products that are much closer to customer demands," he told analysts, citing a decision to reintroduce the popular Hemi eight-cylinder engine for Ram trucks.
Milan-listed shares in Stellantis pared morning losses and rose up to 3.8 per cent after Filosa's call with analysts. They closed up 0.2 per cent.
The French-Italian-American automaker forecast a low-single-digit margin on its adjusted operating income in the second half of 2025, following an "incredibly tough" first half.
"First half was ... nowhere near where we want and need to be," Filosa said.
"We still have tons of work to do. In particular, we are focused on bringing products back to segments where we have been absent," he added, without elaborating beyond the V8 Ram.
Filosa was appointed in May after former boss Carlos Tavares was ousted in December following a disastrous performance last year in the crucial U.S. market.
"I don't like blame, I like responsibility and accountability," Filosa told analysts.
Stellantis' forecasts for the second half, which analysts described as vague, also include higher net revenues and improved industrial free cash flow compared with the first half, when it burned through 3 billion euros (nearly $4.8 billion) of cash.
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The company said the forecasts were based on tariff rules following a weekend trade agreement between the European Union and United States.
The 1.5-billion-euro tariff impact — which includes 300 million euros (nearly $476 million) incurred in the first half — is at the higher end of a forecast range of 1.0 billion to 1.5 billion euros provided last week when Stellantis released preliminary figures for the first half, which were broadly confirmed on Tuesday.
Challenges ahead
Asked whether he was planning to streamline Stellantis sprawling portfolio of 15 brands, which includes Jeep, Peugeot, Chrysler and Fiat, Filosa said it was a "strength" against competitors.
"We want to work it better. We want to be more effective and efficient in our brand portfolio management," he said.
Stellantis in April withdrew its guidance for a moderate recovery this year after a 70 per cent net profit drop in 2024, due to the uncertain impact of U.S. tariffs.
Sunday's EU-U.S. framework trade deal imposed a 15 per cent U.S. import tariff on most EU goods — half the threatened rate.
Stellantis, however, is mostly exposed to the 25 per cent levy that the U.S. has imposed on Mexico and Canada, on top of an existing 2.5 per cent tariff, with more than 40 per cent of the 1.2 million vehicles it sold last year in the U.S. imported from those countries.