Shares of automaker Stellantis experienced a dramatic fall of 23% during European trading sessions, following the company’s announcement of a significant financial setback. The automaker is bracing for a staggering 22 billion euros (approximately $26 billion) impact as it recalibrates its business strategy, particularly hinting at a potential slowdown in its electrification initiatives.
As trading continued, Stellantis shares saw a decline of 22.9% in Milan by 10:30 a.m. In premarket trading on Wall Street, the company’s stock in New York crashed by 20.8%. This downturn also influenced other automotive companies’ shares in France, with Valeo and Forvia each dropping over 1.2%, while Renault decreased by 2%.
In a statement, Stellantis CEO Antonio Filosa addressed the situation, acknowledging that the financial charges were primarily due to an overestimation of the pace of energy transition, which diverged from the actual preferences and needs of car buyers. He further pointed out the repercussions of previous operational challenges, asserting that the company is taking measures to rectify these issues through its newly assembled management team.
Looking ahead, Stellantis clarified its commitment to electric vehicle (EV) development, but with a focus on adjusting the pace to better align with market demand instead of imposing a rigid command structure. The company also provided preliminary insights for the upcoming fourth-quarter results, predicting a net loss for 2025. This forecast prompted Stellantis to suspend its dividend for 2026, alongside a plan to generate up to 5 billion euros by issuing hybrid bonds.
For the fiscal year 2026, Stellantis aims for a modest increase in net revenue and a slight rise in its adjusted operating income margins. The company emphasized that the decision to halt dividends and initiate bond issuance is intended to bolster its balance sheet while highlighting the strategic actions taken in the previous year. This included announcing the largest investment in Stellantis’ U.S. history—amounting to $13 billion over four years—introducing 10 new products, canceling unprofitable lines, and restructuring global manufacturing and quality controls. As part of this investment effort, Stellantis indicated plans to add 5,000 jobs in the United States.
Despite the financial challenges, Stellantis reported a return to positive volume growth in 2025. The latter half of the year indicated a rise in U.S. market share to 7.9%, contributing to the company’s retention of its second-place position in the broader European market.
Additionally, Stellantis is contending with extraordinary write-downs similar to those faced by competitors Ford and GM, who have each disclosed substantial losses tied to their own adjustments in EV strategies. Following the significant financial review, analysts at UBS remarked that the stock’s negative performance was anticipated, yet they found the ongoing management clean-up and strong regional markets potentially promising for a rebound in share performance.
In a related move, Stellantis announced it would divest its stake in NextStar Energy, a joint venture with LG Energy Solution that has been integral to developing a Canadian battery manufacturing site. This decision follows previous goals set by former CEO Carlos Tavares, which included ambitions for 100% battery electric vehicle sales in Europe and a 50% target in the U.S. by the decade’s end.
Moving forward, Stellantis is expected to outline an updated long-term strategy at its upcoming Capital Markets Day scheduled for May. The company’s stock has struggled over the past few years, declining nearly 25% last year and 40.5% the year prior, and is presently down over 13% since the start of 2026.
Filosa has previously referred to 2026 as the “year of execution,” highlighting the company’s ongoing battle with declining sales, leadership transitions, and disappointing earnings. Recent communications also indicated a projected tariffs hit of around 1.5 billion euros in 2025, alongside a reported 2.3 billion euros net loss in the first half of the year.
As Stellantis prepares to release its complete earnings for 2025 on February 26, industry observers are closely watching how the company navigates its current challenges and the broader implications for its market position and EV sales.
