Sterantis decides to sell unprofitable brands

Sterantis CEO Carlos Tavares warned Thursday that the automaker may sell some of its brands if its poor performance continues, after the automaker reported a 48% drop in profits for the first half of 2024.

Sterantis, formed in 2021 through the merger of Fiat Chrysler Automobiles and France's PSA Group, has 14 brands under its umbrella, including Chrysler, Dodge, Jeep, and Ram, as well as premium European brands Alfa Romeo and Maserati The company has 14 brands under its umbrella, including Chrysler, Dodge, Jeep, Ram, as well as Alfa Romeo and Maserati. Sterantis and Leapmotor also count Leapmotor in China as the 15th brand in their portfolio, as Sterantis has established a joint venture to manufacture and sell Leapmotor electric vehicles outside of China. [Carlos Tavares told reporters, including Reuters, “If we don't make money, we will close it down. We can't afford to have brands that don't make money.”

Tavares recently said that Sterantis has committed to a 10-year investment in each brand through 2021.

Also citing analysts, Reuters reported on Thursday that Maserati could be a target for sale and regional brands like Lancia and DS could be dropped due to their niche status.

Sterantis reported first-half net income of 5.6 billion euros (about $6 billion), down 48% from 11 billion euros ($12 billion) in the same period last year. Sales for the same period were down 14% to 85 billion euros ($92 billion).

Tavares said that high inventory levels and poor performance in the U.S. due to declining market share were the main reasons for the profit slump, and that rebuilding the fleet is now the main challenge.

“We think the job is done in Europe,” Tavares told reporters, referring to the reduction in inventory levels.