Stellantis shares fell 23% after the automaker announced a €22.2 billion charge as part of a major business reset. Learn the reasons behind the EV miscalculation, financial impact, job concerns, and the company’s recovery outlook for 2026.
Amsterdam: Shares of global auto giant Stellantis NV dropped sharply by 23% on Friday after the company announced a massive €22.2 billion ($26 billion) charge as part of a major business reset. The move is aimed at better matching customer needs and speeding up the shift toward electric (EV) and hybrid vehicles. CEO Antonio Filosa said the decision reflects mistakes made over several years, especially misjudging how quickly customers would adopt EVs, and marks the beginning of a focused recovery plan for 2026.
Most of these charges are non-cash, and the company will exclude them from Adjusted Operating Income (AOI). It will record the charges in the second half of 2025 (H2 2025), including €6.5 billion in actual cash outflows spread over the next four years. The charge highlights earlier operational errors and a reassessment of Stellantis’ large 14-brand portfolio, which has faced challenges since the 2021 merger of Fiat Chrysler Automobiles and PSA Group.
Explaining the decision, Filosa said the charges mainly come from overestimating the speed of the energy transition, which pushed the company away from what many customers could realistically afford or wanted. He also pointed to poor execution in past operations, which the new leadership team is now trying to fix. Filosa became CEO in May 2025, after Carlos Tavares stepped down in December 2024 following disagreements with the board. He noted that the reset builds on encouraging momentum from new product launches in 2025.
Why Stellantis Is Resetting Its Business
The reset addresses several long-standing problems. Stellantis expected the global shift to EVs to happen faster than it did. As a result, weaker demand and inadequate charging infrastructure delayed models such as the Fiat 500e and Ram 1500 REV. This led to high inventory levels in the U.S., lower profit margins caused by heavy discounts, and a two-year sales decline in North America, which has only recently started to improve.
The company is also facing strong competition from Chinese EV makers, while U.S. import tariffs have already cost it around €300 million in earlier periods. In Europe, strict EU emission rules could result in up to €2.6 billion in fines by 2027 for commercial vehicles if EV adoption remains slow.
The company now sees Stellantis’ wide range of brands—such as Jeep, Ram, Peugeot, Citroën, and Maserati—as too large to sustain. The company has taken writedowns on weaker businesses, especially Maserati, which suffered from poor sales and unsuccessful EV plans. Other costs come from factory closures, job cuts that could affect tens of thousands of workers worldwide, and the cancellation of projects like hydrogen fuel cell programs.
Financial Impact and Outlook for 2026
Early results for H2 2025 show better Net Revenues and Industrial Free Cash Flow compared to the first half of the year. However, the company will still end the full year with a net loss, meaning it will not pay any dividend in 2026.
To strengthen its finances, Stellantis’ board approved the issuance of up to €5 billion in non-convertible subordinated perpetual hybrid bonds. The company ended 2025 with strong liquidity of €46 billion, giving it room to manage the transition.
Looking ahead to 2026, Stellantis expects revenue growth, a higher AOI margin, and stronger free cash flow. Filosa described 2026 as a year focused on execution and said the company will unveil a new long-term strategy at the Investor Day on May 21, 2026. The plan will offer customers more choice, with EVs, hybrids, and advanced internal combustion engine (ICE) vehicles developed based on actual demand. This includes shifting more R&D toward hybrids in Europe and large gasoline-powered vehicles in the U.S., while still honoring commitments such as €13 billion in U.S. investments for factory expansion and 5,000 new jobs.
Market and Stakeholder Reaction
The sharp fall in Stellantis shares wiped out billions of euros in market value, pushing the stock to its lowest level since July 2022. Several analysts downgraded the stock, pointing to uncertainty around which brands will survive and how long recovery will take. Still, some analysts believe the reset was necessary for long-term survival.
On social media platforms like X, many users highlighted Stellantis’ EV strategy mistakes, comparing the situation to General Motors, which recently took $7 billion in EV-related charges.
The situation affects stakeholders in different ways. Consumers may benefit from lower prices and better availability, while dealers report rising order volumes. However, the possibility of large-scale job losses has raised political concerns in Italy and France. Stellantis has pledged to continue purchasing over €7 billion worth of supplies from local suppliers in these countries.
At the same time, the company is dealing with EU demands for “Made in Europe” incentives and U.S. tariffs, reflecting the broader pressures facing the global auto industry.
Overall, this reset marks a major shift toward sustainable growth for Stellantis, but the company’s success will depend heavily on how well it executes its plans in 2026, amid ongoing global and industry uncertainties.
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