Carlos Tavares has been out as CEO of Stellantis for about a year, but that hasn’t stopped him from commenting on the global conglomerate that he played a key role in creating. He has a new book out, and the French title, Un pilote dans la tempête (“A Pilot in the Storm”) kind of tells you everything you need to know. In its pages, Tavares suggests that a Stellantis crack-up could be in offing. From Bloomberg:
“I am worried that the three-way balance between Italy, France and the US will break,” Tavares said [in the book]. The group’s survival as a standalone company will depend on management paying attention to unity “every day” given the risk of being pulled in multiple directions.
Tavares further speculated: “One possible scenario… could be a Chinese manufacturer one day making a bid for the Europe business with the Americans taking back the North America operations.” Those of us who remember when Chrysler was owned by Cerberus Capital Management prior to its 2009 bankruptcy could be justifiably jaded about restored U.S. ownership of Chrysler, Jeep, Dodge, and Ram. But given Stellantis’ current struggles, something probably needs to be done.
FCA worked but Stellantis is in trouble
Let’s run the Wayback machine. Following bankruptcy, Chrysler was ultimately merged with Fiat, and the architect of the deal, the late Sergio Machionne, took the new company public, while also spinning off Ferrari in its own IPO. Both efforts were successful, Ferrari wildly so. But Marchionne died before he could complete his life’s work.
In 2021, the M&A went to the next level and Stellantis was born. Tavares oversaw that adventure, and he was probably that last empire builder in the business with the guts to take it on, having studied at the feet of Carlos Ghosn, the now-disgraced engineer of the Renault-Nissan alliance. But Stellantis is currently in serious trouble and continuing to frustrate the ongoing efforts of John Elkann, the billionaire Fiat scion who controls its destiny, to escape the problem. He urgently wants out, but Stellantis keeps dragging him back in.
Reading between Tavares’ lines
It looks like Tavares is doing some reputation rehabilitation here while simultaneously stirring the pot. In his book, he reportedly presents himself as a defender of the French parts of the Stellantis colossus — the PSA Group, which he took over in 2014 and where he established some substantial credibility as a visionary dealmaker when he acquired Opel from GM in 2017 and greatly improved the performance of a division that the General had spent decades failing to fix.
As for breaking up Stellantis, the business case for a Chinese player grabbing the French and Italian chunks makes reasonable sense, but such a move might encounter plenty of resistance in Europe. Chrysler coming back to full American ownership, somehow, sounds appealing. But the U.S. auto industry is going through such a chaotic period now with tariffs and the EV slowdown that we could be back in a nightmare situation of private-equity ownership followed by aggressive cost-cutting followed by the selling off of the brands, possibly to the Chinese. (Jeep alone would be worth billions.) Stellantis always looked sort of preposterous (too big, too unruly, too many competing national agendas) and time has confirmed all the early concerns about the deal.
The big takeaway here is that the era of automotive Caesars, at least in the West, is completely over. Tavares was the last of his kind. And he seems to want everybody to know it.
