Stellantis, the world's fourth largest car group, risks losing 75 percent of its profits due to the tariffs that come into effect in the United States this week.
A potential American punitive tariff of 25 percent could lead to a significant drop in the profits of the car group Stellantis.
According to a report from investment bank Jeffries, which Automotive News refers to, the company's earnings risk being reduced by up to 75 percent in 2025 as a result of the tariffs.
The large potential drop in Stellantis' profits is due to the fact that a significant portion of the cars the group sells in the US market are produced outside the US, primarily in Mexico and Canada.
In addition, nearly 60,000 Stellantis brand cars were exported from Europe to the United States last year.
Investment bank Jeffries has calculated the consequences based on figures from 2024. If the tariffs had been in effect that year, it would have cost Stellantis $7.1 billion in lost profits.
Bank analysis: Stellantis' profits could collapse by 75 percent
The bank's analysis shows that Stellantis sold a total of 1.3 million cars in the United States in 2024, for a total value of $17.1 billion.
Of those sales, 305,000 cars would be directly affected by the tariff wall, amounting to an estimated tariff burden of $4.3 billion.
On top of that, there is an expected tariff of $2.8 billion on imported parts used in car production in the United States.
Jeffries estimates that Stellantis produces approximately 61 percent of the cars the group sells in the United States within the country's borders.
This is on par with competitor General Motors, but below Ford's share of 80 percent local production for the US market.
The potential economic impact of the tariffs follows a weak 2024 for the car company. Stellantis' earnings before interest and taxes fell 64 percent in 2024.
This led, among other things, to CEO Carlos Tavares leaving his position at the beginning of December 2024. Officially by mutual agreement. In reality, however, it was a dismissal.
Stellantis Chairman John Elkann has since served as interim CEO, and the company has announced that a permanent successor will be appointed during the first half of 2025.
At the same time, Stellantis' share price recently reached its lowest point since the company was formed through the merger between Fiat Chrysler Automobiles and PSA Group in 2021.
The Stellantis Group owns a broad portfolio of automotive brands, which includes Abarth, Alfa Romeo, Chrysler, Citroën, Dodge, DS Automobiles, Fiat, Jeep, Lancia, Maserati, Opel/Vauxhall, Peugeot and Ram Trucks.
