Despite facing significant disruptions due to historic strikes by North American autoworkers, Stellantis confidently projected its determination to achieve its annual profit goals. Recent strikes have slashed revenue by €3 billion ($3.2 billion), the automotive giant acknowledged.
However, its resilience amidst adversity is apparent, as recent revenue reports exceeded expectations and the company remains unfazed in its profit ambitions.
Turbulent Times with the Unions
The company navigated through rocky waters this year, as it endured nearly seven weeks of work stoppage, severely hampering its production and sales.
The tension culminated on Saturday when a tentative agreement was finally struck with the United Auto Workers union (UAW). This wasn't the end of the line, though. Stellantis had another brief hiccup when its Canadian operations came to a standstill due to a strike on Monday.
However, this was quickly resolved in less than eight hours as a separate tentative contract was agreed upon with Unifor, the Canadian union.
Impressive Quarterly Performance Amidst Challenges
Stellantis showcased a commendable revenue report for the July-September period, noting a 7% increase from the same quarter in 2022, amounting to €45.1 billion ($48 billion).
Vehicle shipments also soared, with over 1.4 million vehicles shipped—an 11% rise from 2022. CFO Natalie Knight detailed the North American sales and revenue data, highlighting a modest gain. The figures revealed vehicle deliveries climbing by 6.6% in the quarter, translating to 470,000 vehicles.
Consequently, North American revenue saw a slight uptick of 1.9%, equivalent to 21.5 billion euro or $22.9 billion. Despite these gains, the UAW strike did leave its mark, decreasing the number of vehicles sold in September and October by roughly 50,000.
Furthermore, the company's drive towards a sustainable future is evident, as electric vehicle sales surged by 37% from the previous year. This boom was propelled by popular models like the Jeep Avenger and Citroën ë-Berlingo.
Interestingly, most of these sales were in Europe, given Stellantis has yet to introduce a pure electric vehicle in North America.
Future Forecasts: Mixed Bag for Stellantis
As the company reflects on the tumultuous challenges posed by the North American strikes, a looming cloud of a potential European recession is on the horizon. Europe is Stellantis's major market, accounting for 40% of its sales.
The company, however, remains steadfast in its goal to achieve an adjusted operating profit margin of 10% for the year—a target it has maintained since reporting its first-half profits in July.