Stellantis Sees 29% Stock Plunge Amid Profit Warning and Disappointing Outlook

On Friday, the automotive giant Stellantis faced a severe decline in its stock price, plummeting by as much as 29 percent and marking a record low since the company's formation in 2021 from the merger of PSA (Peugeot Citroën) and FCA (Fiat). This sharp downturn has been attributed to a critical profit warning issued by the company, highlighting significant concerns about its financial health that could not wait for the routine reporting dates typically observed by publicly traded companies at the end of each quarter. The crux of Stellantis's troubles lies in a considerable downward revision of its financial outlook for the second half of 2025. The company cited slower-than-expected changes in its energy transition plans as a primary factor for the revised expectations. Notably, both the United States and the European Union have begun softening regulations regarding the transition to fully electric vehicles, which has adversely affected sales and production commitments. Stellantis's struggle is further complicated by increased budget burdens amounting to €222 billion due to canceled products and halted or converted production processes. The updated forecasts predict a loss between €19 billion and €21 billion for the latter half of 2025, resulting in the bleak announcement that the company will not be distributing dividends to shareholders. Dividends typically represent a company's profits to its shareholders, and in the case of Stellantis, a loss leaves no profits to share. The prospect of dividend payments is a significant factor influencing stock prices, as they represent potential earnings for those who invest in shares. Consequently, the substantial drop in Stellantis's stock is not only a reflection of the immediate profit warning but also reinforces ongoing concerns regarding the company's overall growth trajectory. This predicament unfolds under the leadership of new CEO Antonio Filosa, who succeeded Carlos Tavares after a period marked by crisis and declining sales. As Stellantis navigates these turbulent waters, investors and market analysts are closely monitoring how the company responds to these challenges and whether it can realign its strategies to adapt to the evolving automotive landscape. The recent financial turmoil has raised serious questions about the automaker's ability to transition effectively towards electric vehicle production, a journey that is crucial for its future viability in an increasingly competitive market. Related Sources: • Source 1 • Source 2