Senior Independent Director Henri de Castries stated that in recent weeks, differing opinions among major shareholders, the board, and CEO Tavares led to his resignation.
Stellantis CEO Carlos Tavares abruptly resigned on Sunday, as confirmed by the company, which also announced that it plans to find a replacement by the first half of next year. This decision came after senior independent director Henri de Castries highlighted recent disagreements among major shareholders, the board, and Tavares, which culminated in his resignation.
On the same day, Stellantis revealed that its board, including Chairman John Elkann, had accepted Tavares’ resignation effective immediately. A new interim executive committee, to be chaired by Elkann, was established to oversee the transition. Tavares, who had been among the most respected executives in the automotive industry, faced scrutiny due to declining sales in North America, prompting the company to issue a profit warning for its 2024 results. This forecast included an expected cash burn of up to 10 billion euros, primarily attributed to sluggish sales and growing inventories in North America, the firm’s most profitable region.
This situation led to significant changes in top management, including the replacement of the chief financial officer and the head of North American operations. Despite these changes, it was noted that Tavares was not seeking a new term and planned to retire at the end of his current term in early 2026. Initially, the selection of a new CEO was scheduled to be completed by the end of the next year.
However, sources indicated that tensions escalated after the board felt Tavares was too focused on short-term solutions to safeguard his reputation, which was perceived as not aligning with the company’s long-term interests. This growing rift between Tavares and the board became so severe that it led to the decision to operate temporarily without a CEO.
Since leading the merger that created Stellantis in early 2021, Tavares had overseen the integration of Fiat Chrysler and Peugeot owner PSA, managing 14 brands and warning that underperformers were at risk of discontinuation. His straightforward style often led to conflicts with various stakeholders including U.S. unions and the Italian government over his decisions to cut automotive production in Italy.
In the U.S., the United Auto Workers union had threatened a national strike, accusing Stellantis of not fulfilling commitments made in a contract concluded last year, although Stellantis maintained that it had adhered to the labour agreement. Amid these controversies, the company’s stock value dropped by 40% over the year, contrasting with the performance of competitors like Ford Motor and General Motors, which experienced lesser declines or significant gains.
