FYI: Stellantis Faces Turbulence Amid National Dealer Council’s Criticism
Unless you’re quite unaware, it’s evident that Stellantis, the automotive giant, has encountered quite a few challenges recently. Stellantis oversees 14 distinct brands, including iconic names like Alfa Romeo, Jeep, Dodge, Fiat, and Maserati. Not all brands have performed up to expectations, but there’s no lack of vigor at Stellantis. Numerous innovative initiatives, particularly within the past few months, show signs of positive change across these brands.
This week, Kevin Farish, Chairman of the Stellantis National Dealer Council (NDC), took a bold step by penning a candid letter to Stellantis CEO Carlos Tavares. The letter, scathing in its tone, prompted a swift rebuttal from Stellantis, signaling a dispute on the horizon.
### First Letter and Response
In his letter, Farish didn’t hold back as he claimed to represent the national dealer network and its employees. He voiced concerns over what he described as “reckless short-term decisions” aimed at securing record profits. According to Farish, these decisions have precipitated adverse outcomes, including a “rapid deterioration” of the American brand, plummeting stock prices, factory shutdowns, and widespread layoffs.
“For over two years, the Stellantis National Dealer Council of America has been sounding the alarm to your U.S. management, warning them that the course you have set will be a disaster in the long run. And now that disaster has arrived,” Farish emphasized in his letter.
Although the letter surfaced on September 10, Stellantis swiftly responded on September 12, denying the allegations in no uncertain terms. The rebuttal titled, “Statement in Response to the Letter from the Chairman of the Stellantis National Dealer Council,” makes their stance clear.
### Analyzing the Dispute
“We categorically dispute the letter sent by Stellantis National Dealer Council (NDC) Chairman Kevin Farish,” stated Stellantis in their response. The company highlighted recent improvements, underscoring that an action plan had been implemented with dealers, leading to noticeable gains.
For instance, August sales were up by 21% compared to July, with a 0.7% increase in market share. Additionally, dealership inventories rose by 42,000 units over two months, reflecting a solid 10% bump. This progress points toward positive short-term effects.
Notable developments include the highly anticipated Hurricane inline 6-cylinder engine, which could significantly bolster Dodge’s offerings. Furthermore, the all-electric Jeep Wagoneer S recently hit the market, injecting optimism into the brand’s future.
### Collaborating for Progress
While Stellantis’s response highlighted the desire to work collaboratively to move forward, Farish’s letter painted a stark contrast. Stellantis reaffirmed their commitment to weekly discussions aimed at determining a positive trajectory. They stressed that such conversations should occur in person rather than through open letters.
“We do not believe that personally attacking the CEO is the right approach. Such actions may only worsen the situation and fail to resolve the underlying issues,” Stellantis noted. “We intend to continue working with our dealers to avoid public disputes that would hinder our ability to deliver results.”
### Stellantis Maintains Commitment to Its Brands
On August 30, Stellantis made it clear that there were no plans to sell its 14 North American brands. Instead, they reaffirmed their commitment to revitalize these brands over a decade.
Stellantis’s July sales results revealed a 4% increase over the previous quarter, showing promise despite a 21% year-over-year decline. Key highlights include a 107% increase in Jeep Wagoneer sales and a 24% uptick in Grand Wagoneer sales. Additionally, retail sales for the Jeep Wrangler, Grand Cherokee, and Compass grew by 24%, 12%, and 15%, respectively, compared to earlier quarters. The Ram, Chrysler, and Alfa Romeo brands also showcased notable gains.
### Conclusion
While Stellantis faces significant criticism from within, the company stands firm in its commitment to progress. With an array of promising initiatives and a clear action plan, Stellantis seems poised to navigate through turbulent times. As the dynamics between the national dealer network and Stellantis executives evolve, only time will tell how these efforts will play out.
For more insights and updates, reach out to us at tips@automotive.fyi, or on Twitter @automotivefyi.
Donald Smith, Editor of Automotive.fyi
