Dodge, Jeep could see a huge shake at the top

The multinational car manufacturer Stellantis (STLA) the parent company of some of the most recognizable American car brands like Dodge, Jeep and Chrysler, has faced a series of problems and a mountain of criticism from dealers and even the United Auto Workers union.

According to a recent analysis by auto shopping site CarEdge, six of the ten slowest-selling cars in the U.S. belong to Stellantis brands, some with nearly a two-year supply on dealer lots across the country.

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However, while the automaker is offering “increased incentives” to clear its expanded inventory, a massive recall is currently affecting one of its best-known brands: Jeep.

As the problems mount, the brand’s critics are pointing the finger at Stellantis CEO Carlos Tavares as solely responsible for the mess, but a new report suggests some more dramatic moves at the automaker.

Carlos Tavares, CEO of Stellantis NV, at the Stellantis car manufacturing plant in Sochaux, France, Thursday, October 3, 2024.

Bloomberg/Getty Images

Tavares’ change was felt around the world

According to sources within Stellantis who recently spoke to Bloomberg, the CEO is planning a major shakeup of management roles across its brands and departments.

The Post reports that his proposal could lead to major changes to the manager’s leadership in his various key departments, such as regional operations, to those affecting individual brands such as Dodge, Jeep or Chrysler.

Sources say the proposal could be presented at a board meeting Tavares plans to attend in the United States, where it may not prove popular with other executives.

Overall, the outlet reports that the meeting is focused on finding ways to speed up recovery efforts in the United States, where it admits it is currently struggling to sell cars.

Jeep vehicles are delivered to a dealer in Chicago, Illinois.

Scott Olson/Getty Images

The move comes as Stellantis is mired in a wave of other problems fueled by industry pressure.

Reports in late September indicated that the automaker was looking for a new CEO in the event that he was not hired in 2026, and more recently filed multiple lawsuits against the United Auto Workers (UAW) union over claims they – he denied vehemently.

But if there’s any writing on the wall at Stellantis, it would say action must be taken.

In a dire statement issued on September 30, the auto multinational slashed its financial outlook for 2024, cutting its adjusted operating income margin guidance from “double digits” to between 5.5 – 7.0% for 2024 , as well as a negative cash flow of between 5 billion. and 10 billion euros ($5.58-11.17 billion).

Stellantis blamed the gloomy outlook on factors affecting the North American market, weakening global demand and intensifying competitive dynamics due to increased industry supply and increased competition from China.

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Another course of action

However, steps are being taken to help lessen the blow.

In new sales data released on October 1, Stellantis reported that it sold 305,294 cars in its portfolio in the US during the third quarter of 2024 – a decrease of 19.8% compared to the same period last year and a decrease of 11, 5% compared to the last quarter.

While those figures indicate the substance of a loss, the automaker said an “aggressive stimulus program” of bigger and bolder discounts implemented at the start of the quarter paid off, noting that dealer inventory fell by 50,000 units, or 11 .6%.

“These cross-brand incentives, which will continue through the end of the year, also contributed to the consecutive month of total share growth in Q3, from 7.2% in July to 8% in September,” said Matt Thompson , Stellantis’ head of retail sales in the US. statement from October 1.

Related: Honda’s best-selling cars face massive recall

Additionally, an Oct. 4 Wall Street Journal report reported that Stellantis is starting to tighten its spending belt, citing an internal email from CFO Natalie Knight to company employees with the subject line, “The doghouse is back!”

In it, she instructed her finance team to intensively re-evaluate purchase requests from external suppliers to reduce unnecessary spending, as Doghouse is an internal term meaning “much tighter attention and control regarding purchase requests.”

“If we apply more discipline, we can secure big savings for the company,” Knight said in the email.

Stellantis NV, which trades on the New York Stock Exchange as STLA, is down 0.56% from the opening bell, trading at $13.32 per share at the time of writing.

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