Summary
- Q3 revenue 33 bln euros vs forecast 31.1 bln
- Total inventories down 129,000 on year to 1.33 mln
- US inventory reduction ahead of expectations – CFO
MILAN, (Reuters) – Stellantis reported on Thursday a 27% fall in third quarter revenue, slightly better than expected as the automaker pushed ahead with fixing bloated inventories and poor commercial performance that led to a major profit warning last month.
“Inventory reduction in the United States is running at a faster rate than expected,” new finance chief Doug Ostermann said on a call, adding he expected to reduce inventories at U.S. dealers by 100,000 vehicles ahead of an end-November target.
Stellantis shares were up 0.7% at 0819 GMT. They have lost about 40% of their value this year.
Ostermann, who previously headed Stellantis’ operations in China, replaced Natalie Knight this month as part of a top management reshuffle aimed at correcting strategic mistakes, especially in North America.
Stellantis’ specific problems are combining with broader struggles for Western automakers, including soft global demand, especially for electric vehicles (EVs), technological transition challenges, and increased competition from Chinese peers.
Europe’s biggest automaker Volkswagen is assessing plans to shut at least three factories in Germany and lay off tens of thousands of staff, in a more radical than expected overhaul, its works council head said this week.
Stellantis on Thursday confirmed its recently reduced full-year results guidance.
After posting a 40% decline in adjusted operating income (EBIT) in the first half, Stellantis last month forecast a full-year adjusted operating profit margin of 5.5-7%, down from a previous double-digit estimate, and cash burn of up to 10 billion euros. It also signalled possible cuts to its dividend and share buybacks in 2025.
The group posted third-quarter revenues of 33 billion euros ($35.8 billion), beating analyst expectations of 31.1 billion euros, according to a Reuters poll run after Oct. 16, when Stellantis, for the first time, provided preliminary forecasts on its quarterly unit sales and shipments.
Shipments fell 21% to 1.17 million vehicles. Gaps in the product lineup were the main driver of the decline, Ostermann said, though he added those gaps should start to close.
The company said it remained on track to launch approximately 20 new models across 2024.
Stellantis said total inventory stood at 1.33 million vehicles as of Sept. 30, down 129,000 year-on-year. In the U.S., total inventory at dealers fell by over 80,000 between June 30 and Oct. 30.
($1 = 0.9215 euros)
Reporting by Giulio Piovaccari and Gilles Guillaume, writing by Alvise Armellini and Giulio Piovaccari; Editing by Gavin Jones and Mark Potter
