(Bloomberg) -- Stellantis NV’s third-quarter revenues slumped 27% as the automaker shipped fewer cars from factories in most of its major markets.
Net revenues fell to €33 billion ($35.8 billion), Stellantis said Thursday, missing analyst projections for a €35.9 billion result. Shipments were down in regions including Europe and North America, where the company is working to shrink bloated inventory after pushback from US dealers.
Third quarter figures are “clearly below our potential” but Stellantis is making “good progress in reducing inventory and improving market share dynamics in the US,” new Chief Financial Officer Doug Ostermann said on a call with reporters. “October is set for another roughly 10% month-on-month improvement in absolute sales volumes.”
Stellantis has been grappling with delays in the introduction of new models, product recalls and shrinking market share in the US and Europe after raising prices more than peers. Chief Executive Officer Carlos Tavares has struck a defiant tone since a disastrous profit warning last month, pledging fixes and replacing executives including his finance chief. The company on Thursday confirmed its lowered guidance.
Earlier this month, the owner of the Jeep and Fiat brands reported declining third-quarter vehicle shipments, led by a 36% drop in the key North American market. Stellantis on Thursday said it reduced its US dealer inventories by more than 80,000 units in the four months through October.
The carmaker’s European revenue — which declined less than its shipments in the region thanks to a stronger-than expected product mix — helped offset some of the woes in North America, Bernstein analysts led by Daniel Roeska said in a note.
Stellantis shares rose 1.7% as of 10:49 am in Milan. The stock is still down more than 40% this year.
Stellantis is unique among European automakers in that its issues are most acute in North America. In September, leaders of the company’s US dealer network accused Tavares of damaging brands including Jeep, Dodge, Ram and Chrysler, and urged him to spend more money to clear inventory off their lots.
Ostermann said he decided against narrowing the range of the full-year guidance to give management sufficient flexibility to work down inventories and regain market share. The company will stick to its dividend policy and may pursue a share buyback next year, the CFO added. He joined Fiat Chrysler in 2016, stayed with the automaker through the merger with France’s PSA Group and was appointed Stellantis finance chief earlier this month.
Stellantis cited robust demand for new models including the Citroën C3 and the Peugeot 3008, adding it will offer 40 fully electric models in Europe this year. Still, it pointed to product delays and pricing pressures in its home region.
“The numbers aren’t good, but this was largely expected,” said Eric Hassid, a trader at Aurel BGC. “The new full-year guidance is reaffirmed and Tavares will do everything he can to turn the ship around before leaving.”
(Updates with CFO comment in seventh paragraph.)
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