Stellantis Faces Uncertainty After CEO Tavares Resigns Amid Internal Conflict

Carlos Tavares resigned as CEO of Stellantis
Carlos Tavares resigned as CEO of Stellantis. Credit | Getty images

United States: Carlos Tavares who is the CEO of Stellantis, has stepped down from his position unexpectedly and the reasons are not known. The company said his resignation or leaving was due to differences in views between him and the board of directors. Stellantis, which is basically the fourth-largest carmaker in the world for real and also announced on Sunday that they accepted Tavares’ resignation, and his departure is effective or very immediately. The company has not shared more details about the reasons behind the disagreement.

Stellantis, the maker of Jeep, noted that its search for the successor of its CEO is underway and that it should complete the skill before the first half of the year. Until then, it announced a new interim executive committee composed by the current chairman John Elkann.

As reported by the CNBC.com, since the Stellantis creation, the efficiency observed is that the three components of the governance system are perfectly intertwined between the reference shareholders, the Board, and the CEO. But over the past few weeks, there have been different opinions that led to the Board and the CEO to arrive at today’s decision, said Henri de Castries, Stellantis senior independent director.

The spokesman of Stellantis refused to provide any further details regarding the resignation.

T slipping some 7% in the previous trading session and 4.8% in the premarket Monday as the outbreak threatens to derail the carmaker’s breakthrough year. Before the resignation of the Governor, the stock was on an even worse state when it was USD 10 in 2024, which was a 43 % decline.

Bernstein’s Daniel Roeska said in an investor note Sunday night “The market will inevitably ask why the Stellantis board considered that not having a permanent CEO for some months was preferable to keeping the current CEO in situ.” “There is some difficulty in finding how these events can be managed in a way that supports the stock price in any sense.”

In the revised annual outlook unveiled on Sunday, Stellantis maintained earlier lowered targets, rebuilt based on an adjusted operating income margin of 5.5% to 7% and industrial free cash flow of between negative 5 billion euros and negative 10 billion euros.

Tavares’ resignation occurs a little more than one month after the company announced that he was planning to retire, when his contract expires in early 2026. Stellantis said earlier this year that it aims to announce a successor before the fourth quarter of the year after that.