Tavares, responsible for the commitment to the Stellantis electric car, resigns

Carlos Tavares resignsCEO of Stellantis, and one of the main architects of the merger between FCA (merger in turn of the Fiat and Chrysler groups) and the French PSA (with brands such as Peugeot, Citroën and recently also with Opel). Tavares leaves office as of December 1, 2024, ending a mandate of almost four years in a turbulent times for the automaker.

His departure, two months after a benefits notice reduced the market value of Stellantis by almost 50%reflects the difficulties that car manufacturers face in the transition to the electric car.

Following Tavares’ resignation, Stellantis shares fell more than 7% during early morning hours in Europe, as investors reacted with evident concern about the leadership vacuum and the uncertainty surrounding the automaker’s future strategy.

Ambitious goals, disappointing results

Tavares defended the investment of 50,000 million euros from Stellantis in the electric vehiclewith the goal of reaching 100% battery electric vehicle sales in Europe by 2030.

However, sales did not meet expectations. According to the latest EV Tracker report from Bank of America, Stellantis sold 173,400 battery electric vehicles in the first half of 2023, a figure that fell to 157,700 in the first half of 2024, a year-on-year decrease of 9%. This fall coincided with Stellantis’s loss of ground in the global electric car market.

Stellantis’ global market share in the electric car segment fell to 3.5% in the first half of 2024, from 5.3% in the first half of 2023, as Chinese electric car makers moved ahead with competitive prices and innovation. These difficulties contributed to Stellantis shares falling nearly 50% this year and eroded confidence in Tavares’ leadership.

Tavares Resigns: And Now What?

Tavares was the highest paid automotive executive in 2023, with a remuneration package of 36.49 million euros. The decision to separate was apparently made by unanimous consensus among the members of the Stellantis board of directors.

Although Stellantis praised Tavares for his contribution to the formation of the company and its initial success, the internal disagreements between the board and the CEO They played a key role in his departure. Chairman John Elkann cited “divergent views” on Stellantis’ management as the catalyst for Tavares’ resignation.

The Stellantis board has begun the search for Tavares’ successor, with the aim of concluding the appointment in mid-2025. Meanwhile, Elkann will chair a newly created executive committee tasked with guiding the company through this transition phase.

Voices and reactions from the sector

The automotive sector was quick to react to Tavares’ departure. On X (formerly Twitter), former Nissan and Aston Martin CEO Andy Palmer praised Tavares as “perhaps the most professional man in the automotive world “I hope history is kind to him.”

However, others were less sympathetic. Italian senator Carlo Calenda criticized Tavares for his managerial approach: “Tavares will not be missed. The defender of Darwinian theories that only seemed to apply to workers. Now it is even more urgent to summon John Elkann to Parliament.”

Investment analyst Brian Tycangco warned that Stellantis’ problems reflect a broader trend: “Traditional automakers are losing ground to Chinese electric vehicle brandseven in its most profitable markets. “Innovation is no longer optional.”

What awaits Stellantis?

Tavares’s departure highlights the difficulties that traditional car manufacturers face in their transition from traditional combustion engines to electric ones.Stellantis must now face increasing competitionto the fall in sales of electric vehicles and the need to regain the confidence of investors.

The German giants Volkswagen, BMW and Mercedes-Benz They also face similar headwinds, such as falling market share for electric vehicles and increasing Chinese competition. When Elkann temporarily takes over, Stellantis will be under immense pressure to find a leader capable of balance innovation with operational excellence. It remains to be seen whether the next CEO will be able to turn around the company’s fortunes, but the stakes are high not only for Stellantis, but also for the European automotive sector as it struggles to remain competitive in an electrified world.