By Giulio Piovaccari, Nora Eckert and Gilles Guillaume MILAN, April 24 (Reuters) - Stellantis will focus the majority of its investment on its core Jeep, Ram, Peugeot and Fiat brands under CEO Antonio
Stellantis Refocuses Funding on Core Car Brands in New Strategic Turnaround
Stellantis Strategic Investment Shift: Focus on Core Brands and Market Adaptation
By Giulio Piovaccari, Nora Eckert and Gilles Guillaume
MILAN, April 24 (Reuters) - Stellantis will focus the majority of its investment on its core Jeep, Ram, Peugeot and Fiat brands under CEO Antonio Filosa's strategic plan due to be announced in May, five sources said, with a "material increase" to their funding.
The world's fourth-largest automaker by sales is set to outline its long-term strategy, which will concentrate on its most popular and profitable international brands, in Detroit.
Implications for Stellantis’ Other Brands
Other marques across the 14-brand Stellantis stable, which includes Citroen, Opel and Alfa Romeo and is the largest in the sector, are set to receive funding to build models using technology from the four core brands, the sources said.
The lower volume brands, which have previously received a more even slice of the internal investment pie, will become regional or national ones in specific markets where they are already strong or have potential, the sources told Reuters.
Market Challenges and Financial Pressures
Stellantis is battling to regain U.S. and European market share and faces competition from Chinese automakers in Europe and emerging markets. In February, it booked a 22.2 billion euro ($26.1 billion) charge as it backed off plans for electric cars.
The strategic shake-up at Stellantis, which was formed in 2021 through the merger of Fiat Chrysler and Peugeot maker PSA, has the backing of major investors including its top shareholder Exor, three sources said.
Stellantis told Reuters that its brands were its strength and stressed its mix of "global scale with deep local roots", without commenting directly on the planned reorganisation.
Valuation and Brand Rationalization
Current Valuation Status
VALUATION HAS TUMBLED
As Stellantis has struggled, its valuation has tumbled to a market capitalisation of around 21 billion euros. This is barely above EV startup Rivian's $21 billion stock market value and less than half of Volkswagen's.
Debate Over Brand Closures
Some investors and analysts have suggested Stellantis should shut down some brands, which often overlapped particularly in Europe, in order to save money and reduce inefficiencies. Lancia, DS, Citroen and Opel have all been named as candidates.
However, Filosa, who became Stellantis CEO last year with a mandate to turn around its fortunes, does not want to go down this route as he sees such brands as having potential in regions or large national markets, four sources said.
Expert Opinions on Brand Strategy
"Some of those brands could prove useful to the group in the future, should market conditions evolve," said Marco Santino, a partner at consultancy Oliver Wyman, adding that once a brand had been closed it was "very hard to bring it back to life".
Former Stellantis CEO Carlos Tavares, who presided over the merger, publicly refused to consider closing any brands. But after his exit in December 2024, chairman John Elkann focused heavily on which brands had a viable future.
Focus on ‘Brands That Really Matter’
Investment Priorities and Strategic Direction
FOCUS ON 'BRANDS THAT REALLY MATTER'
Filosa's plan will focus investment on Jeep, Ram, Peugeot and Fiat as the brands that "really matter" because of their higher sales volumes and profits, a source told Reuters.
His predecessor had insisted all brands shared overall investments more evenly, the source added.
Regional and Tactical Use of Other Brands
Under its new strategy, Stellantis will now use brands such as Citroen, Opel and Alfa Romeo tactically in specific countries and market segments, four sources said.
Options for regional brands include using platforms and technologies developed by the core brands, adding their own internal and external design features and handling to give them a distinctive look and feel, the fourth source said.
Rebadging some models for specific local markets is another solution under consideration, two of the sources said.
Reuters reported earlier this month that Stellantis was in advanced talks with Chinese partner Leapmotor to jointly develop an Opel-branded electric SUV, in a potential example of how regional brands could rely on sharing underlying technology while retaining individual brand identity.
Stellantis Holds Off ‘Sunsetting’ Brands
Strategic Use of Brand Portfolio
STELLANTIS HOLDS OFF 'SUNSETTING' BRANDS
A top Stellantis executive said the long-term success of the plan would depend less on shrinking the portfolio and more on using brands strategically in different markets to gain share.
Stellantis has long planned for most of its models to use a limited number of shared, so-called "multi-energy" platforms, supporting both fully electric and hybrid or petrol powertrains.
But that was tailored for a quick shift towards EVs, which failed to materialise, an ex-Stellantis top executive said.
Potential for Future Brand Closures
Stellantis could still eventually dispense with some brands, analysts said, although carmakers have been historically reluctant to do so unless left with no choice, as General Motors did with Saturn and Pontiac during a 2008 bankruptcy process.
In the short term, Stellantis executives "have to focus on the brands that matter," said Larry Dominique, a consultant and former head of the Alfa Romeo brand in North America.
"At some point Stellantis may have to sunset some brands. But they're going to have to make that decision based on the forward performance of the core brands," he added.
($1 = 0.8508 euros)
(Reporting by Giulio Piovaccari in Milan, Gilles Guillaume in Paris and Nora Eckert in Detroit; additional reporting by Alessandro Parodi in Gdansk; writing by Giulio Piovaccari; editing by Nick Carey, Adam Jourdan and Alexander Smith)
