### Stellantis Lowers Earnings Forecast Amid Industry Challenges and Chinese Competition

Stellantis, ranked as the fourth-largest carmaker globally, has adjusted its earnings forecast downward, pointing to a combination of a broader industry downturn and growing competition from Chinese automakers. The company has also highlighted its intensified efforts to turn around its North American operations.

To tackle pressing industry challenges, Stellantis announced it would accelerate plans to reduce dealer inventory levels in North America. Initially set for the first quarter of 2025, the target to bring inventory down to no more than 300,000 vehicles has now been moved up to the end of this year. This decision follows a notable decrease in vehicle shipments, with 200,000 fewer units shipped in the latter half of this year compared to the same period last year—a figure that is double the earlier forecast.

In an effort to manage current stock more effectively, Stellantis plans to offer higher incentives for its 2024 and older models. Despite these measures, the company’s financial outlook has darkened. Stellantis now projects finishing the year with a negative cash flow ranging between 5 billion euros to 10 billion euros ($5.6 billion to $11.2 billion) instead of a positive cash flow. Additionally, the company has revised its operating profit margin, dropping from an anticipated double-digit rate to between 5.5% and 7.0%.

The impact of these forecasts has been immediate, as Stellantis shares have plunged by 14.45%, trading at 12.45 euros during Monday midday in Milan. This sharp decline reflects investor concerns about the carmaker’s near-term profitability and the effectiveness of its strategic initiatives.

The current situation marks a significant setback for Stellantis, which was formed in 2021 through the merger of PSA Peugeot and Fiat Chrysler Automobiles. The company must now navigate through challenging market conditions while adjusting to increased competition from the Chinese automotive sector.