Senior Independent Director Henri de Castries said in a statement that divergent views cropped up in recent weeks among major shareholders, the board and Tavares resulting in the CEO's resignation, the newswire stated.
02 Dec 2024 | 3751 Views | By Autocar Professional Bureau
Stellantis CEO Carlos Tavares suddenly resigned on Sunday, Reuters reported. The company said it would find a replacement CEO in the first half of next year.
Senior Independent Director Henri de Castries said in a statement that divergent views cropped up in recent weeks among major shareholders, the board and ...
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Stellantis CEO Carlos Tavares suddenly resigned on Sunday, Reuters reported. The company said it would find a replacement CEO in the first half of next year.
Senior Independent Director Henri de Castries said in a statement that divergent views cropped up in recent weeks among major shareholders, the board and Tavares resulting in the CEO's resignation, the newswire stated.
Stellantis gave a statement on Sunday that its board, including Chairman John Elkann, accepted the CEO's resignation "with immediate effect" and that a new interim executive committee, chaired by Elkann, would be formed, Reuters said.
Earlier regarded as amongst the most respected executives in the auto industry, Tavares' approach came under inspection after falling sales in North America led the firm to issue a profit warning on its 2024 results, the newswire added.
That included a forecast for a cash burn of up to 10 billion euros ($10.6 billion), mostly due to slow sales and bloating inventories in its North American market, the group's profit powerhouse, Reuters noted.
This warning resulted in a major reshuffling of top management, including changes of its chief financial officer and of its head of North American operations.
After that, however, Stellantis noted that Tavares was not seeking a new CEO term and would retire at the end of his current mandate, in early 2026. The process to select a new CEO was initially set to be completed by the final quarter of next year.
A person in the know informed Reuters that tensions grew after the board felt that Tavares was moving too quickly and concentrating on near term solutions to salvage his reputation, working against the best interests of the company.
The sudden announcement on Sunday highlights the that widening rift between the board and Tavares had to be grave, given that the parties decided it was better to operate with no CEO on a short-term basis, Bernstein analysts noted.
Tavares has led Stellantis since its creation in early 2021 through the merger of Fiar Chrysler and Peugeot owner PSA. The firm has 14 brands, and Tavares warned underperformers among the portfolio were at risk of being taken down, Reuters noted.
His outspoken style has often seen him in conflict with counterparts including U.S. unions and the Italian government, which complained about his decisions to reduce auto production in Italy.
In America, the United Auto Workers union threatened a nationwide walkout, alleging Stellantis failed to keep the commitments it made in a contract finalised last year. Stellantis said it has complied with the labour agreement.
The company's stock has seen a 40% loss this yearm whereas shares of competitors Ford motor are down 7% and General Motors up 55%, the newswire noted.