Stellantis in search of successor to Carlos Tavares who will retire at the beginning of 2026

A few days ago during a visit to the historic Peugeot factory in Sochaux, in the form of a joke and with a big smile, Carlos Tavares responded to journalists on the future of the Stellantis automobile group and his own with this sentence : “In 2026, the person answering you will be 68 years old, it is a reasonable age to retire. Isn’t it? “. And added: “If you ask my wife, it’s a demand on her part. I am a good husband! »

His wife’s wishes will therefore be granted. The automobile group announced on the night of Thursday to Friday that it had launched “the process of identifying its successor”. Stellantis specified in its press release that “the process of identifying his successor” was entrusted to a special committee of the board of directors chaired by John Elkann, representative of the Agnelli family, the group’s largest shareholder, which must complete its work in the fourth quarter of 2025. Stellantis also announced changes “with immediate effect” to several group managers.

A tighter organization

“In order to simplify and improve the performance of its organization in a turbulent global environment”, the Franco-Italian-American group has made “targeted organizational changes which come into effect immediately within its management team”. It is, he continues, “about refocusing the company on its main operational priorities and tackling with determination the global challenges facing the automotive sector”.

The group has also decided to link the management of its supplies to the industrial department, and more to that of purchasing “for greater commercial performance”.

“In this period of Darwinian transformation for the automotive industry, our duty and ethical responsibility is to adapt and prepare for the future, better and faster than our competitors, in order to offer our customers clean mobility , safe and affordable,” explained Carlos Tavares. For his part, John Elkann, chairman of the board of directors, assured of the “unanimous” support of the directors for Carlos Tavares and the redistribution of roles carried out. “We are confident that these steps to simplify our organization will strengthen our management team in its efforts to restore the company’s performance to benchmark levels in its sector,” he noted.

A group in difficulty

The group with fifteen brands (Chrysler, Citroën, Fiat, Jeep, Dodge, Lancia, Opel, Peugeot, Ram, Vauxhall, etc.) is going through a difficult time. At the end of September, it announced a clear downward revision of its operating margin objective, now estimated between 5.5% and 7%, compared to “two figures” previously, for the year 2024. In addition, Stellantis published in July a sharp fall in results in the first half, handicapped in particular by an 18% drop in sales in North America, which was considered the group’s cash machine. Worse, in the third quarter, sales continued to fall by 20% year-on-year in North America.

It must be said that the Portuguese manager who made a name for himself by turning around the PSA group (Peugeot-Citroën) from 2014, by cutting costs and focusing more on profitable sales than on the number of cars sold n is not very optimistic about the automotive future in Europe. He who managed to complete the megamerger between PSA and FCA (Fiat-Chrysler) with the creation of Stellantis in 2021 had so far set net profit records, with a new bar at 18.6 billion euros in 2023 .

But “it is not Stellantis which is in difficulty isolated in the middle of the automobile industry. It’s Stellantis, Volkswagen, BMW, Mercedes, and it’s probably not over,” warned Carlos Tavares a week ago during his visit to the historic Peugeot factory in Sochaux.

To make matters even worse, it is true that the group is going through a series of additional disruptions with airbag recall campaigns on certain types of engines.

Even if the root of the problem is not there. In Europe, the rapid electrification of the automobile further complicates the prospects of car manufacturers in the face of aggressive competition from Chinese brands and after gloomy years crossed by the Covid period, the shortage of parts. All in a context of inflation and economic slowdown.

Manufacturers forced to produce less

Several manufacturers, such as Mercedes and Renault, have already requested a downward revision of CO2 emissions standards, which will force them to sell more electric vehicles at the start of 2025. With a Damocles sword hanging over its head: if the objectives are not achieved, Europe will sanction them with fines of several billions.

As a true industrialist, Carlos Tavares, even if he continues to contest a transition that he considers “dogmatic” towards 100% electric in 2035, has nevertheless decided to adapt the group to this requirement. “Everyone has known the rules for a long time, everyone has had time to prepare, and so now we are racing,” he said in September.

Even though he is passionate about old cars, Carlos Tavares has always said he wants to “contribute to solving the problem” of global warming, for his four grandchildren.

The problem is that this transition will hurt this European industry and several subcontractors have already gone out of business. Because, in order to survive in Europe, car manufacturers will be forced to produce less expensively while costs increase (raw materials, electricity, tax pressure, etc.). As a result, the pressure will become increasingly strong in the coming years on employees and on suppliers who remain, in quotation marks, “the first adjustment variables”.

At the risk of being unpopular, Carlos Tavares did not hesitate to implement plans to cut jobs and to produce cars in low-cost countries. Several unions have also denounced its methods with strikes in Italy and the United States.

And if the difficulties persist, it is not certain that the group will sell several of its brands in the future. According to some rumors, Chinese groups are already in the running.

Who to succeed Carlos Tavares?

There are far too many to appoint the successor of Carlos Tavares before the latter can take care of his vines in Portugal. The fact remains that this promises to be complex. The future boss will have to be skillful enough to meet the expectations of the Agnelli family, the majority shareholder, to be diplomatic enough to manage the persistent tensions between the Italian and French states, to be able to negotiate with the unions, etc.

Names have already been mentioned such as Roy Jakobs, the boss of Philips, Michael Manley the former director of the America region of Stellantis or Maxime Picat, the former director of Peugeot. Obviously, other scenarios can come into play. Recently rumors of mergers between Renault and Stellantis had circulated. Even if they have been denied, the name of Luca de Meo, the current boss of Renault is also sometimes cited even if his mandate has just been renewed for four years… And what’s more, that’s good for the Agnelli family who knows him well from his time at Fiat, he is Italian.