Stellantis reports record financial results, commits to electrification

Published Feb 16, 2024 • 3 minute read

Carlos Tavares, CEO of Stellantis, speaks with the media at the 2022 North American International Auto Show at Huntington Place in Detroit on Sept. 14, 2022. Photo by Dax Melmer /Windsor Star

Despite enduring a strike last fall that cost it about a billion dollars, Stellantis reported Tuesday it had set records for net profit, net revenues and industrial-free cash flow in 2023.

Net profit rose 11 per cent to just over US$27 billion while net revenues increased six per cent to $275.6 billion. Stellantis’s industrial-free cash flow jumped 19 per cent to $18.7 billion.

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“As we just passed the three-year mark since Stellantis’ inception, I warmly thank our teams who are executing at the highest levels and contributing greatly to our growth story, even in the strongest of headwinds,” said Stellantis CEO Carlos Tavares during a webcast of the results.

“Today’s record financial results are proof that we have become a new global leader in our industry and will remain rock solid as we look to a turbulent 2024.”

Stellantis also reported its net profit fell 13 per cent to $11.15 billion for the second half of the year.

The company achieved its goal of an annual double-digit adjusted operating income margin at 12.8 per cent, down from 13.4 in 2022. The margin was 15.4 per cent in North America on a one per cent increase in net revenue.

With plans to launch eight new electric vehicle models in North America this year, Tavares remains bullish on the company’s EV prospects. The company has nearly $89 billion in liquidity to draw on to help it navigate through what it expects to be a mixed 2024 for the industry.

“We keep it full speed on electrification,” Tavares said.

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Tavares is confident the new offerings, most of which will arrive in the second half of 2024, will help it win back the one per cent it lost in U.S. market in 2023.

Among the new products being introduced are the next generation Charger and Challenger produced at Windsor Assembly Plant.

“In terms of EV … we’re going to move from 30 models by the end of 2023 to 48 models by the end of 2024,” Tavares said.

“With some very strong models in iconic brands like the RAM 1500, the Jeep Recon, the Wagoneer S and the brand-new Dodge Charger with more power, more torque, more burnouts and more donuts.

“I’ve driven all these new cars, these are outstanding products, outstanding technology and dynamic performance.”

Tavares said Stellantis is making a profit on every electric vehicle it sells. He added the company is also reducing the total cost of production for electric vehicles faster than on internal combustion ones.

“We’re highly profitable, among the most profitable in the business,” Tavares said. “We’re working hard to bring BEV (battery electric vehicle) sales to ICE (internal combustion engine) levels.

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“Those sales are profitable, not as profitable as ICE, but that gap is closing every day.”

Ironically, Tavares noted the slowdown in EV sales in 2023 has helped the industry reduce the cost of electric vehicles. The slump in demand has pushed down critical mineral prices and Tavares feels the increased affordability will help draw more customers to electric products.

However, Stellantis isn’t placing all its bets on electrification.

The company’s decision three years ago to develop its four new platforms to be capable of being BEV, hybrid, fuel cell and ICE products gives it maximum flexibility to navigate this transitory period.

“We’re possibly the only automotive company who are proposing in our low emission offerings, BEVs, fuel cells and range extenders,” Tavares said. “In terms of technology, we have the best coverage of the market.”

That multi-energy flexibility will help keep the cash coffers filled and Stellantis’s advantageous financial position will allow the company to pounce on any consolidation opportunities as well as fend off competition from Chinese automakers.

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In addition to affordability, Tavares said accelerating EV adoption requires more clean energy, a more visible and dense charging network and products that are enjoyable to drive while addressing range and charging time concerns.

The other two Detroit Three automakers also recently reported their year-end financial results.

Ford Motor Company reported a net income of US$5.9 billion while General Motors had a net income of US$13.5 billion.

The other automakers with domestic production plants, Honda and Toyota, have differing fiscal years than the calendar year.

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