Stellantis CEO Carlos Tavares Resigns Amid Disappointing Sales and Labor Unrest
Stellantis, the parent company of brands such as Chrysler, Jeep, Fiat, and Peugeot, announced on Sunday that CEO Carlos Tavares had resigned due to differences with the board and disappointing sales. The departure comes amid a decline in the company’s global sales, a surplus of unsold vehicles at dealerships, and layoffs at several of its plants.
Tavares, 66, was a key figure in the merger of PSA Group and Fiat-Chrysler to form Stellantis, the world’s fourth-largest automaker. However, his tenure has been marked by disappointing sales, price increases, and labor unrest. The company’s average vehicle price has risen, making its products less competitive in the market.
Stellantis’ sales have dropped 10% in the first half of this year, with a 20% decline in the third quarter. In the United States, sales are down 17% for the first nine months of the year. The company has also laid off over 1,200 workers at its truck plant in Warren, Michigan, and plans to cut one of two shifts at its Toledo Assembly Complex South plant, indefinitely laying off about 1,100 workers.
The United Auto Workers (UAW) union has been critical of Tavares’ leadership and threatened to strike if the company does not meet the terms of its contract. Stellantis has denied any wrongdoing and plans to challenge the legality of any new strike.
Tavares’ departure follows a steep drop in Stellantis’ share price, and his total compensation package of 36.5 million euros, equivalent to $36.8 million, has been criticized as exorbitant. The UAW has welcomed his resignation, calling it a “major step in the right direction” for the company and its workforce.
Kevin Farrish, chairman of the company’s US dealers’ council, has been critical of Tavares’ leadership, citing a focus on increasing profit margins and executive pay rather than producing vehicles at competitive prices. The departure of Tavares marks a new chapter for Stellantis, with a Special Committee of the Board set to appoint a new permanent CEO by the first half of 2025, pending the conclusion of the process.