Abstract

The case captures a series of crises at Stellantis, the fourth largest automaker in the world. It details the strategic missteps taken by the company such as a stringent cost reduction strategy, overpriced products, lack of new products in the portfolio, issues related to the transition to electric vehicles (EVs), and the company’s strained relationships with key stakeholders, under the leadership of Carlos Tavares (Tavares). The strategic errors further led to excess inventory, disagreement with dealers, and a sharp decline in the net profit of the company (an almost 48% drop) during the first half of 2024 compared to the same period in 2023. Due to lack of innovation in the EVs segment and the rapidly changing global automobile market, Stellantis lost its share in the EVs market. In the first week of December 2024, Tavares left the company after a disagreement with the Stellantis board members. All these threatened its stability as well as its position in the global automobile market. After Tavares, John Elkann (Elkann), Chairperson, Stellantis, became the interim leader of the company. Under Elkann, Stellantis focussed on a decentralized approach, balancing innovation with financial stability and healthy stakeholder management strategically to regain its position in the global market. Though the company faced many challenges, Elkann was confident that with proactive measures being taken, Stellantis would be able to win trust in the market.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Identify the key strategic factors and market dynamics that enable a company to succeed in the global automobile market.
• Analyze how strategic blunders affect the competitive position of a company in the market.
• Examine the opportunities and challenges in the global automobile market with respect to EVs.
• Formulate growth strategies of a company by understanding its market position.

Keywords

Stellantis; EVs; Automobile Market; Competitive Position; Market Positioning; Cost Synergies; Organizational Restructuring; Brand Positioning; Brand Revitalization; Sustainable Growth; PESTEL Analysis; Porter’s Five Forces