Stellantis Q3 sales tank as US inventory reduction continues

Shares in Italian-American auto giant Stellantis edged higher on Thursday after a big drop in third-quarter revenues wasn't as bad as feared, as the company works to cut inventory levels at US dealerships.

The Fiat, Chrysler, Jeep and Peugeot maker reported revenues of €33.0bn for the quarter, down 27% on last year, due to lower shipments and an unfavourable product mix, along with pricing and FX changes. Nevertheless, analysts were expecting a figure closer to €31.1bn.

Shipments were 20% lower at 1.15m due to production gaps in several models ahead of new launches, along with planned inventory reductions in North America. The company also blamed a "challenging" market environment in Europe for the year-on-year decline.

Stellantis said that US inventory levels remains "a focus priority". Inventories have been cut by 80,000 since the start of July, and the company is on track to hit its 100,000-reduction target by the end of November.

Looking ahead, the company said its so-called "product blitz" remains on track with 20 new models expected to be launched in 2024 overall.

“While Q3 2024 performance is below our potential, I’m pleased with our progress addressing operational issues, in particular US inventories, which have been reduced meaningfully and are on track for year-end targets, as well as stabilisation of US market share," said chief financial officer Doug Ostermann.

"In Europe, stringent quality requirements delayed the start of certain high-volume products, but with progress resolving challenges we will soon benefit from the significantly expanded reach our generational new product wave brings to 2025 and beyond.”

The stock was up 2.6% at €12.56 by 1147 in Milan.