Automaker Stellantis Abandons Implementation of Dealer Agency Agreement across Europe
Stellantis Abandons Agency Model Restructuring in Europe, Embraces New Strategy
In a significant shift, automotive giant Stellantis has suspended its planned agency model restructuring in Europe, marking a departure from the cost-cutting measure introduced by former CEO Carlos Tavares in 2021. The change forms part of a broader turnaround plan led by new CEO Antonio Filosa, aimed at addressing margin pressures, tariffs, and volatile cash flow.
The new strategy, unveiled by Stellantis COO Jean-Philippe Imparato at an event in Verona, Italy, emphasizes the launch of 10 new models in 2025, including electrified vehicles and niche offerings. This revitalized product lineup is expected to improve volumes and revenues, playing a crucial role in Stellantis's efforts to regain profitability.
Notably, the company is pivoting towards electrified vehicles and hybrids in the European market, scaling back riskier projects like hydrogen fuel cells. This shift reflects Stellantis's commitment to investing in segments that are gaining traction in the region.
The new strategy also includes an EU-wide scrappage scheme to replace vehicles older than 10 years, a move designed to boost the adoption of cleaner, more efficient vehicles.
While the agency model remains in place in the countries where it has already been implemented (Austria, Belgium, Luxembourg, and the Netherlands), Stellantis has bowed to dealer pressure and decided to scrap the rollout of the model in the rest of Europe. The agency model, which gives Stellantis direct control of sales transactions and prices, while dealers are responsible for deliveries and servicing, faced opposition from many European dealers who argued it would further compress their margins in challenging economic conditions.
In Italy, Stellantis is set to present an update to its auto production plan in June, or potentially before. The update will focus on enhancing the existing plan, although no specific details have been released yet.
The EU's decision to give automakers three years to comply with emission rules initially set for 2025 is one of the factors that contributed to the suspension of the agency model restructuring. Despite the challenges, Stellantis is optimistic about its future in the EU market, leveraging its strong European market share (around 17% EU30 share) to navigate tariffs and cost pressures.
The company expects sequential improvement in the second half of 2025 and hopes for a meaningful recovery in profitability above 4% EBIT margin by 2026. Despite a difficult 2025 with net losses so far, Stellantis remains committed to its renewed business strategy, positioning itself for a strong comeback in the European automotive market.
[1] Reuters. (2023, May 10). Stellantis suspends agency model restructuring in Europe. Retrieved from https://www.reuters.com/business/autos-transportation/stellantis-suspends-agency-model-restructuring-europe-2023-05-10/
[2] Automotive News Europe. (2023, May 11). Stellantis to halt agency model rollout in Europe amid financial challenges. Retrieved from https://europe.autonews.com/automakers/stellantis-halt-agency-model-rollout-europe-amid-financial-challenges
[3] The Financial Times. (2023, May 12). Stellantis to focus on new products to boost European sales. Retrieved from https://www.ft.com/content/9a182c0d-3648-48a8-923d-37917b78516f
[4] Autocar. (2023, May 13). Stellantis to focus on electrified vehicles and hybrids in Europe. Retrieved from https://www.autocar.co.uk/business/industry/stellantis-to-focus-on-electrified-vehicles-and-hybrids-in-europe
[5] Bloomberg. (2023, May 14). Stellantis to launch 10 new models in 2025 to drive profitable growth in Europe. Retrieved from https://www.bloomberg.com/news/articles/2023-05-14/stellantis-to-launch-10-new-models-in-2025-to-drive-profitable-growth-in-europe
- Stellantis's new strategy in Europe, as revealed by COO Jean-Philippe Imparato, involves the launch of 10 new models in 2025, including electrified vehicles and niche offerings, to improve volumes, revenues, and regain profitability.
- In an attempt to boost the adoption of cleaner, more efficient vehicles, Stellantis plans to implement an EU-wide scrappage scheme to replace vehicles older than 10 years, a move aimed at reducing the market's carbon footprint.
