Automotive giant Stellantis faces €1.5 billion hit from US tariffs
The producers of luxury Maserati cars as well as mid-range and affordable favourites such as Lancia, Peugeot and Fiat, said on Tuesday that net profits plummeted from €5.6bn in the same period last year. This was as it burned €3.3 billion in cash for the cancellation of a hydrogen fuel cell project. Changes in the fine regime for US carbon emission regulations and write-downs on platform investments also hit profits.
US President Donald Trump's tariffs cost the company €300 million in the first six months of the year, Stellantis said.
Losses like these could crank up political and labour pressure as the carmaker faces a heightened risk of plant shutdowns, delayed model launches and fights with unions as management scrambles to manage the cash gap.
Carmakers are the main drivers of European industry. The sector pumps out roughly 7% of EU GDP according to the European Commission, supports around 14 million jobs across its supply chains and delivers one of the bloc's biggest export surpluses each year.
Automakers also pour more than €70bn annually into engineering and technological innovation. A dip in their fortunes can therefore ripple into technology, steel, chemicals, logistics and the continent's drive for innovation.
Stellantis said it expected net revenues to increase over the next six months compared with the first half, when they dropped 13% to €74.3bn. The carmaker also said cash flow would improve.
Incoming CEO Antonio Filosa, who was confirmed in the role last month, said the new executive team would "continue to make the tough decisions needed to re-establish profitable growth and significantly improve results".
'My first weeks as CEO have reconfirmed my strong conviction that we will fix what's wrong with Stellantis,'' Filosa said in a statement.
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