Stellantis to Book €22.2B Charges Amid EV Demand Challenges
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1h ago
0mins
Should l Buy STLA?
Source: seekingalpha
- Massive Charge Booking: Stellantis plans to book approximately €22.2 billion ($26.18 billion) in charges for the second half of 2025, primarily due to overestimating electric vehicle demand, which caused shares to drop about 14% in early trading on Friday.
- Cash Payment Impact: The charges include around €6.5 billion ($7.66 billion) in cash payments expected over the next four years, which will significantly impact the company's liquidity and financial stability.
- Net Loss Forecast: Stellantis anticipates a net loss of €19 billion to €21 billion for FY 2025, leading to a decision not to pay an annual dividend in 2026, which could negatively affect investor confidence.
- Bond Issuance Plan: The board has authorized the issuance of non-convertible subordinated perpetual hybrid bonds up to €5 billion (~$5.90 billion) to strengthen the balance sheet and support future cash flow generation.
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Analyst Views on STLA
Wall Street analysts forecast STLA stock price to rise over the next 12 months. According to Wall Street analysts, the average 1-year price target for STLA is 11.81 USD with a low forecast of 9.33 USD and a high forecast of 15.15 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
14 Analyst Rating
7 Buy
7 Hold
0 Sell
Moderate Buy
Current: 10.230
Low
9.33
Averages
11.81
High
15.15
Current: 10.230
Low
9.33
Averages
11.81
High
15.15
About STLA
Stellantis N.V., formerly Fiat Chrysler Automobiles N.V., is a holding Company based in the Netherlands and operates as an automaker and a mobility provider. The Company is engaged in designing, engineering, manufacturing, distributing and selling vehicles, components and production systems. The Company has industrial operations in more than 30 countries and sells its vehicles directly or through distributors and dealers in more than 130 countries. The Company designs, manufactures, distributes and sells vehicles for the mass-market under the Abarth, Alfa Romeo, Chrysler, Dodge, Fiat, Fiat Professional, Jeep, Lancia and Ram brands. In addition, the Company designs, manufactures, distributes and sells luxury vehicles under the Maserati brand. The Company's brand portfolio also includes Peugeot, Citroen, DS Automobiles, Opel and Vauxhall. It offers a wide variety of vehicle choices from luxury and mainstream passenger vehicles to pickup trucks, sport utility vehicle (SUVs).
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Stellantis Anticipates €22 Billion Charge Due to Energy Transition Overestimation
- Financial Loss Projection: Stellantis anticipates a significant charge of approximately €22 billion (around $26 billion), primarily due to overestimating the pace of the energy transition, which indicates a disconnect from actual consumer needs and could lead to a decline in market share.
- Management Statement: CEO Antonio Filosa stated that these charges reflect not only a misjudgment of market demand but also highlight previous operational execution shortcomings, emphasizing that the new team is progressively addressing these issues to restore the company's competitiveness.
- Electrification Transition Challenges: Stellantis's business overhaul aims to accelerate the rollout of electric and hybrid vehicles; however, the inflated expectations may lead to misallocation of resources, potentially impacting the company's long-term strategic goals and market positioning.
- Potential Market Reaction Impact: The announcement of such a substantial loss may negatively affect investor confidence, particularly against the backdrop of increasing competition in the electric vehicle market, necessitating Stellantis to implement effective measures to regain market trust.
See More
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- Powertrain Options: The Charger lineup features the 550-horsepower SIXPACK-powered Charger Scat Pack, the 420-horsepower Charger R/T, and the 670-horsepower all-electric Charger Daytona Scat Pack, the latter being recognized as the world's quickest and most powerful muscle car, catering to diverse consumer preferences.
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- Full-Year Loss Warning: Stellantis has warned of a net loss for 2025, planning a sweeping business reset involving €22 billion ($26 billion) in charges to cut costs and realign products, thereby strengthening its financial position ahead of a new strategic plan.
- Shipment Growth: Despite challenges, Stellantis reported fourth-quarter shipments of approximately 1.5 million units, a 9% year-over-year increase, with North American shipments surging 43%, reflecting strong market demand and normalized inventory levels.
- Strategic Realignment Progress: The company has completed a comprehensive review of its strategy and cost structure, projecting improvements in net revenues and adjusted operating income in 2026, although it will not pay dividends in 2025 due to the anticipated loss.
- Debt Financing Plan: Stellantis' board has approved the issuance of up to €5 billion in non-convertible, subordinated perpetual hybrid bonds to bolster balance sheet strength, with industrial liquidity expected to reach around €46 billion by year-end.
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- Joint Venture Background: Established in 2022, NextStar Energy aims to build Canada's first large-scale battery manufacturing facility in Windsor, Ontario, and the acquisition will allow LG to fully control the project, further solidifying its leadership in the battery market.
- Stellantis' Future Plans: Despite the stake sale, Stellantis will continue sourcing battery products from NextStar Energy, ensuring continuity in its electric vehicle strategy while providing a stable customer base for NextStar.
- Financial Impact: Stellantis will book charges of approximately €22.2 billion ($26.5 billion) in the second half of last year, reflecting a scaling back of its EV development plans and a strategic shift that may impact its future market performance.
See More
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- Massive Financial Loss: Stellantis is forecasting a net loss of €22 billion for 2026, primarily due to €22.2 billion in charges booked in the second half of 2025, which will significantly strain the company's financial health and necessitate the suspension of its dividend for 2026.
- Debt Financing Measures: To safeguard its balance sheet, Stellantis has authorized the issuance of up to €5 billion in hybrid bonds, a move aimed at enhancing financial flexibility, although the company still reported available industrial liquidity at a robust €46 billion at year-end.
- EV Strategy Reevaluation: The company has reassessed the pace of customer adoption of electric vehicles, leading to €14.7 billion in write-downs, reflecting a misjudgment of market demand, with the CEO stating that previous operational execution issues are being progressively addressed to meet real consumer needs.
- Signs of Recovery Emerge: Despite financial challenges, Stellantis reported an 11% year-over-year increase in second-half shipments to 2.8 million vehicles, with North America up 39%, indicating positive impacts from improved inventory management and sales enhancements.
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- Revenue Beats Expectations: The quarterly revenue reached $2.22 billion, surpassing the analyst consensus estimate of $2.05 billion and significantly up from $1.36 billion in the same period last year, showcasing the company's success in user growth and monetization.
- Stock Price Surge: Roblox shares jumped 14.3% to $69.24 in pre-market trading, reflecting a positive market reaction to the earnings report, which may attract more investor interest.
- Market Dynamics Impact: The release of this earnings report could influence the stock performance of other related companies, particularly in the gaming and tech sectors, demonstrating market confidence in the industry.
See More
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- Financial Loss Projection: Stellantis anticipates a significant charge of approximately €22 billion (around $26 billion), primarily due to overestimating the pace of the energy transition, which indicates a disconnect from actual consumer needs and could lead to a decline in market share.
- Management Statement: CEO Antonio Filosa stated that these charges reflect not only a misjudgment of market demand but also highlight previous operational execution shortcomings, emphasizing that the new team is progressively addressing these issues to restore the company's competitiveness.
- Electrification Transition Challenges: Stellantis's business overhaul aims to accelerate the rollout of electric and hybrid vehicles; however, the inflated expectations may lead to misallocation of resources, potentially impacting the company's long-term strategic goals and market positioning.
- Potential Market Reaction Impact: The announcement of such a substantial loss may negatively affect investor confidence, particularly against the backdrop of increasing competition in the electric vehicle market, necessitating Stellantis to implement effective measures to regain market trust.
See More
Dodge Charger Wins 2026 MotorWeek Best of the Year and Best Sport Coupe Awards
- Award Recognition: The Dodge Charger has won both the 2026 MotorWeek Drivers' Choice Awards for Best of the Year and Best Sport Coupe, highlighting its exceptional performance across 12 vehicle categories and solidifying its leadership in the muscle car market.
- Powertrain Options: The Charger lineup features the 550-horsepower SIXPACK-powered Charger Scat Pack, the 420-horsepower Charger R/T, and the 670-horsepower all-electric Charger Daytona Scat Pack, the latter being recognized as the world's quickest and most powerful muscle car, catering to diverse consumer preferences.
- Market Impact: This recognition not only validates the Charger's uncompromising performance and innovative design but also reflects consumer trends favoring multi-energy powertrains, enhancing Dodge's competitive edge in the ongoing electrification transition.
- Heritage and Innovation: With 112 years of history, the Dodge brand continues to innovate, and the Charger's success not only preserves the legacy of muscle cars but also elevates the brand's image through modern design and technology, attracting the attention of a new generation of consumers.
See More
Stellantis Warns of Full-Year Net Loss Amid Business Reset
- Full-Year Loss Warning: Stellantis has warned of a net loss for 2025, planning a sweeping business reset involving €22 billion ($26 billion) in charges to cut costs and realign products, thereby strengthening its financial position ahead of a new strategic plan.
- Shipment Growth: Despite challenges, Stellantis reported fourth-quarter shipments of approximately 1.5 million units, a 9% year-over-year increase, with North American shipments surging 43%, reflecting strong market demand and normalized inventory levels.
- Strategic Realignment Progress: The company has completed a comprehensive review of its strategy and cost structure, projecting improvements in net revenues and adjusted operating income in 2026, although it will not pay dividends in 2025 due to the anticipated loss.
- Debt Financing Plan: Stellantis' board has approved the issuance of up to €5 billion in non-convertible, subordinated perpetual hybrid bonds to bolster balance sheet strength, with industrial liquidity expected to reach around €46 billion by year-end.
See More
LG Energy Solution Acquires NextStar Energy from Stellantis
- Acquisition Deal: LG Energy Solution is set to acquire full ownership of NextStar Energy, with Stellantis selling its 49% stake, a strategic decision aimed at optimizing the joint venture's operational efficiency.
- Joint Venture Background: Established in 2022, NextStar Energy aims to build Canada's first large-scale battery manufacturing facility in Windsor, Ontario, and the acquisition will allow LG to fully control the project, further solidifying its leadership in the battery market.
- Stellantis' Future Plans: Despite the stake sale, Stellantis will continue sourcing battery products from NextStar Energy, ensuring continuity in its electric vehicle strategy while providing a stable customer base for NextStar.
- Financial Impact: Stellantis will book charges of approximately €22.2 billion ($26.5 billion) in the second half of last year, reflecting a scaling back of its EV development plans and a strategic shift that may impact its future market performance.
See More
Stellantis Warns of Full-Year Net Loss in 2026
- Massive Financial Loss: Stellantis is forecasting a net loss of €22 billion for 2026, primarily due to €22.2 billion in charges booked in the second half of 2025, which will significantly strain the company's financial health and necessitate the suspension of its dividend for 2026.
- Debt Financing Measures: To safeguard its balance sheet, Stellantis has authorized the issuance of up to €5 billion in hybrid bonds, a move aimed at enhancing financial flexibility, although the company still reported available industrial liquidity at a robust €46 billion at year-end.
- EV Strategy Reevaluation: The company has reassessed the pace of customer adoption of electric vehicles, leading to €14.7 billion in write-downs, reflecting a misjudgment of market demand, with the CEO stating that previous operational execution issues are being progressively addressed to meet real consumer needs.
- Signs of Recovery Emerge: Despite financial challenges, Stellantis reported an 11% year-over-year increase in second-half shipments to 2.8 million vehicles, with North America up 39%, indicating positive impacts from improved inventory management and sales enhancements.
See More
Roblox Reports Quarterly Earnings Exceeding Expectations
- Quarterly Losses in Line: Roblox reported a quarterly loss of $0.45 per share, aligning with analyst expectations, which indicates stability in financial management despite ongoing challenges.
- Revenue Beats Expectations: The quarterly revenue reached $2.22 billion, surpassing the analyst consensus estimate of $2.05 billion and significantly up from $1.36 billion in the same period last year, showcasing the company's success in user growth and monetization.
- Stock Price Surge: Roblox shares jumped 14.3% to $69.24 in pre-market trading, reflecting a positive market reaction to the earnings report, which may attract more investor interest.
- Market Dynamics Impact: The release of this earnings report could influence the stock performance of other related companies, particularly in the gaming and tech sectors, demonstrating market confidence in the industry.
See More
