Stellantis (STLA) shares limped into Thursday’s open as anticipated charges in the second half of the year tied to regulatory, geopolitical, macroeconomic and “other internal developments” overshadowed better-than-expected sales for the company in the third quarter, driving the stock more than 10% lower at the open.
“As we continue making important and necessary changes to our strategic and product plans, also in response to regulatory, geopolitical, macroeconomic and other external and internal developments, we anticipate incurring charges in H2 2025, which, once finalized, we expect will largely be excluded from [adjusted operating income],” the company said in a statement.
The company has also initiated a review of its warranty estimation process, which is expected to result in changes and one-off charges in the second half of 2025.
Stellantis (STLA) did not elaborate on how much these charges would be.
The “external and internal developments” cited by the company appear to reflect the effects of U.S. trade policy, which has disproportionately affected EU-based Stellantis (STLA) compared with its Detroit competitors, Ford (F) and General Motors (GM).
Stellantis (STLA) is also grappling with struggles in its EU market amid intense competition from cheaper Chinese rivals, and conflicts with its U.S. labor unions, all of which are creating challenges for its new CEO, Antonio Filosa.
To mitigate U.S. tariffs on imported vehicles, Stellantis (STLA) said it will invest $13B over the next four years to accelerate production in the U.S. and launch five new vehicles. This includes reopening the Belvidere, Illinois plant, assembling an all-new midsize RAM truck in Toledo, Ohio, and producing both a new ICE and EV SUV in Warren, Michigan.
Unfortunately, the anticipated charges for the remainder of the year upstaged these initiatives as well as a 13% increase in third quarter revenue to €37.2B ($43.04B), beating estimates of €36.66B.
By region, sales were down 30% in North America, up 4% in Enlarged Europe, up 8.5% in the Middle East and Africa, and unchanged in China, India and Asia Pacific.