Stellantis Profit Hit by Tougher Competition from China

Stellantis reported second-quarter adjusted operating income of 293 million euros, missing analyst estimates due to intensified competition in Europe from Chinese automakers such as BYD, Xpeng, and Geely, which are expanding with lower-priced hybrids and EVs. The company cited weak pricing and raw-material inflation as key factors. Despite this, CEO Antonio Filosa is pursuing 6 billion euros in annual savings by 2028 and investing 60 billion euros through 2030. Stellantis shares fell 5% in Milan, and are down 47% this year. The company is trying to make itself leaner to respond to challenges, with a focus on the Jeep, Ram, Peugeot, and Fiat brands, and partnerships with Chinese companies to help fill underused plants in Europe. In North America, sales and adjusted earnings improved, but above-average product recalls continue to weigh on profitability. Stellantis has had to fix multiple models, including over 1 million Jeep Wrangler and Gladiator vehicles in the US due to a fire risk. The company is expecting net tariff headwinds of up to 1.2 billion euros this year, but has reaffirmed its financial guidance for the year.