Stellantis shares are tumbling Monday after the Chrysler and Jeep parent issued a profit warning.
Stellantis (STLA) shares plunged 13% on Monday after the Chrysler and Jeep parent issued a profit warning, driven by excess North American inventory and intensifying competition from Chinese automakers. The company revised its fiscal 2024 adjusted operating income margin to between 5.5% and 7.0%, down from previous expectations of double-digit growth. Two-thirds of this reduction is attributed to “corrective actions” in North America.
Stellantis also accelerated plans to normalize U.S. inventory levels, targeting no more than 330,000 units by the end of 2024, instead of the first quarter of 2025. Earlier this month, the automaker temporarily halted production of its popular Jeep Wrangler and Grand Cherokee models due to dealer complaints about excess inventory.
The warning not only affected Stellantis but also dragged down shares of General Motors (GM) and Ford Motor (F), which dropped 3% and 2%, respectively. Stellantis has now lost over 50% of its stock value this year.
Adding to its challenges, Stellantis faces labor unrest as United Auto Workers (UAW) President Shawn Fain announced plans to hold a vote on a potential walkout amid ongoing labor negotiations.
