Stellantis, parent company of Vauxhall has revealed the crisis as it revealed a 20 percent drop in deliveries compared to a year earlier.
Stellantis brand shipments in the world fell by 279,000 units to 1.14mn in the three-month period ending September 2023, compared to the same period of 2023. In North America, shipments plunged by 36 percent, from 171,000 to 299,000 vehicles, due to the company’s inability manage the energy transition.
Vertu Motors UK, the UK’s biggest listed car dealer reported a sharp drop in profits due to the costs of lower margins after a period of heavy discounts to move a backlog electric cars and help carmakers reach zero emission vehicle sales targets, or face large fines.
Stellantis was created by the mega-merger of 2020 between the French Peugeot Citroen Group and the Italian American concern Fiat Chrysler Automobiles. Vauxhall was already part of the group before that deal, when General Motors had sold the company to France for €1 and Opel, a German loss-making sister firm.
The shares of one of the most powerful automakers in the world, with revenues last year of €190 billions, have been more than halved over the past six-months, valuing the company at around $36 billion.
has been in crisis for months , as the company warned that there was a large amount of unsold cars in the United States with its Jeep and Dodge brands; and also in Europe. The company complained bitterly that the rules for electric car transition were coming in too quickly for it and that the company faced a spiral of fines if it did not meet zero-emissions targets. It even threatened to sell the vehicles at a profit to reduce the fines.
In recent weeks, speculation has increased that Carlos Tavares could be replaced. John Elkann is the company’s chairman, and he is a descendant of the Agnelli industrial family. He is also the biggest shareholder in Stellantis.
Vertu Motors announced that its pre-tax profit fell by 25 percent to £23.5million despite an increase of £70million in revenue in the six months up to the end August, to £2,49 billion.
Robert Forrester said that the industry was flooded with offers of zero percent financing and what are called finance deposit allowances. These are contributions from manufacturers or lenders in order to reduce the price of a vehicle.
Forrester, referring to the £15,000 fine per car that UK manufacturers face if they do not meet zero-emission vehicle thresholds, said it was an incentive for “quite a bit of discounting” in order to move cars.
Forrester was asked if he thought manufacturers were operating in a loss just to shift inventory that had been built up due to the slowdown of battery electric sales. He said this could not be excluded.
In the UK, sales of electric vehicles to private motorists have declined by 7 percent this year. This is in contrast to fleets or company car schemes that receive tax incentives.
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