Fired! Stretched out automotive group loses its mentor
The Board of Directors of Stellantis (Peugeot, Citroën, Opel, Jeep, Fiat, etc.) has accepted the resignation of CEO Carlos Tavares with immediate effect. The Group is reporting poor results.
Carlos Tavares, the Portuguese at the helm of PSA since April 2014, before the merger with Fiat Chrysler Automobiles to create the Stellantis Group in 2021, has “resigned”. A board of directors chaired by John Elkann has ousted Carlos Tavares from Stellantis. The accepted resignation looks more like a forced departure. The automotive group is looking for a new CEO, who will be appointed in early 2025. In the meantime, a temporary executive committee is taking over the reins, under the leadership of John Elkann, the chairman of Stellantis.
Clashes and closures
Carlos Tavares, described as a “cost killer”, had successfully turned around PSA before organizing the purchase of Fiat Chrysler and the merger into the sprawling Stellantis group, comprising 14 French, Italian, German and American brands. In recent months, however, the group has been in turmoil. In particular, there's the issue of the 1.2 Puretech engines which, following a design problem dating from before the Tavares era, have appeared fragile over time, leaving many customers stranded. The reaction of the brands concerned damaged consumer confidence. There have also been recent plant closures in Italy and underperformance in the USA.
Strategic errors
The man who was due to retire in 2026 has therefore had to leave a ship whose progress has been rocky for some time. He's paying for the Group's poor results, linked to a sharp drop in sales and a fall in the share price. Carlos Tavares still wanted to cut costs, in line with his rigorous management strategy. The Board of Directors reportedly refused. He could also be criticized for his sometimes surprising electrification policy, even if it meant reversing decisions at a later date, as was the case with the ex-best-seller Citroën Berlingo. There is also the rebellion of dealers who have not accepted the new sales and partnership logic, with new contracts transforming them into commission-based agents.
(MH with Olivier Duquesne - Sources: Stellantis and agencies - Picture: © Stellantis)