Stellantis CEO faces mounting criticism from UAW and U.S. dealers over sales declines and cost-cutting measures.

• The UAW has criticized CEO Tavares for recent sales declines, factory production cuts, and other decisions, and Stellantis' U.S. dealer network has joined in the criticism.
• Tavares was criticized by the head of Stellantis' U.S. dealer council for prioritizing the company's profits over sales, market share, and the reputations of its American brands.
• The UAW is organizing a protest on Thursday afternoon near Stellantis' Warren Truck Plant in Detroit to express their disapproval of the company's poor management.

The U.S. dealer network has criticized CEO Carlos Tavares for the company's recent sales declines, factory production cuts, and other decisions that they believe are harmful to the automaker's business, along with the United Auto Workers union.

In an open letter to Tavares, the head of Stellantis' U.S. dealer council, Kevin Farrish, criticized the CEO for prioritizing profits over sales, market share, and the reputations of the company's Chrysler, Dodge, Jeep, and Ram brands. The council represents the company's 2,600 U.S. dealers.

Stellantis' market share of brands has been cut in half, its stock price is plummeting, plants are shutting down, layoffs are widespread, and key executives are leaving the company. Lawsuits from investors and suppliers are piling up, and the company's distribution network and dealer body are in a weakened state, as Farrish wrote in a letter on Tuesday, which was reported by Bloomberg on Wednesday night.

Farrish, a Virginia dealer, stated that the dealer council has raised concerns about the company's operations for two years and accused Tavares of "reckless short-term decision making" that boosted profits and padded his compensation but have led to the "rapid degradation" of its brands.

Stellantis rejected the letter, stating that it experienced a 21% increase in August sales compared to July and developed an action plan with the dealer body.

"Stellantis believes that public personal attacks, such as the one in the open letter from the NDC president against their CEO, are not the most effective way to solve problems. Instead, they have started a path that will prove successful and will continue to work with their dealers to avoid any public disputes that will delay their ability to deliver results."

In 2023, Stellantis recorded a record profit, but in the first half of this year, the automaker reported a net profit of 5.6 billion euros ($6.07 billion), which is 48% lower than the same period in 2023.

Since the merger between Fiat Chrysler and France's PSA Groupe in January 2021, Tavares has been focused on increasing profits and doubling revenue to 300 billion euros ($325 billion) by 2030 through a profit-driven, cost-cutting approach as part of his "Dare Forward 2030" plan.

The company has implemented cost-saving measures such as reshaping its supply chain and operations, reducing headcount, and cutting vehicle production at plants.

Several Stellantis executives described the earlier cuts as difficult but effective, while others, who spoke on the condition of anonymity due to potential repercussions, said they were grueling to the point of excessiveness.

Tavares has been criticized by UAW President Shawn Fain for price gouging consumers and not fulfilling parts of the union's labor contract with the automaker, as stated in a speech at the Democratic National Convention last month.

An email stated that the UAW, representing approximately 38,000 Stellantis employees, will hold a rally on Thursday afternoon at a union hall near Stellantis' Warren Truck Assembly Plant in suburban Detroit to "condemn the gross mismanagement" at the company.

Since 2018, U.S. sales for Stellantis, previously Fiat Chrysler, have been declining every year, with a 1% drop in 2021 and a significant 13% drop in 2022 compared to the previous year.

According to federal data, the U.S. new light-duty vehicle sales market increased by 13% last year, while Stellantis' performance was comparable.