Stellantis Lowers Annual Forecast Amid Restructuring Costs and EV Competition

On Monday, Stellantis NV said that it would exceed its budget and lowered its yearly expectations. For this, the company cited several factors, including declining industry trends, higher costs related to restructuring its U.S. operations, and competition from China in the electric car market. Stellantis has expressed concerns about lower-than-expected profitability, joining rivals Mercedes, BMW, and VW in doing so.

Stellantis Adjusts Operating Margin to 5.5-7% Amid US Inventory and Supply Chain Struggles

As the European Union finalizes preparations for potential tariffs on Chinese electric vehicles, earnings forecasts are being downgraded. Aston Martin, a high-end British automaker, also released a full-year profit warning on Monday, blaming weakening in China and problems in its supply chain.

Stellantis indicated that it was removing its anticipation of positive free cash flow and revised its cash burn forecast for this year to between 5 and 10 billion euros ($5.58 and $11.17 billion). It also lowered its operational profit margin outlook. Stellantis stated that this year’s adjusted operating profit margin will be between 5.5% and 7.0%, largely as a result of its decision to expedite the normalization of US inventory levels. The owners of the Chrysler, Dodge, Jeep, Fiat, Citroen, and Peugeot brands announced that by the end of 2024, they wanted to reduce their dealer inventory to no more than 330,000 cars.

For more up-to-date crypto news, you can follow Crypto Data Space.