(Bloomberg) -- In his first public comments since Stellantis NV confirmed it had started searching for his successor, Chief Executive Officer Carlos Tavares signaled he’s open to leaving the automaker just over a year from now.
Leaving when his contract expires in early 2026 is “one option,” Tavares told reporters Thursday at a press conference in Sochaux, France. When asked whether he may step down before then, the 66-year-old responded: “I signed a contract.”
Tavares is under pressure amid slumping sales in North America, delayed new-model introductions in Europe and the threat of labor-union strikes in the US and Italy. The setbacks have coincided with a broader industry slowdown in demand for electric vehicles, culminating in Stellantis slashing its earnings forecasts early this week.
The Stellantis CEO has pursued stringent cost cuts as the company contends with weaker demand for electric cars and intensifying competition from Chinese manufacturers. In the US, the Jeep and Chrysler maker is struggling with excessive inventory, quality issues and declining market share.
Tavares has in recent weeks been demanding additional budget cuts to protect profitability, stoking worries that his aggressive efficiency push may ultimately endanger longer-term projects and revenue flows, Bloomberg News reported last week.
Defiant Tone
The beleaguered CEO struck a defiant tone on Thursday when asked about this week’s profit warning that stunned investors and analysts, blaming it on a “small operational mistake” in the US that “in no way” begs questions about his strategy.
The auto industry is suffering across the board, Tavares said, pointing to rivals and suppliers also having trouble. He again urged suppliers to cut costs so that Stellantis can offer more EVs consumers can afford.
Tavares allowed that there maybe has been “a certain clumsiness” in the ways Stellantis has been dealing with its employees, following claims by unions and managers that continuous efforts to eliminate jobs is unsettling staff, driving away talent and leading to performance issues.
Tavares said he “largely” has the time to fix the various challenges the company faces before his contract expires.
Stellantis remains profitable, he said. “The company is not at risk.”
(Updates with additional comments and background from fourth paragraph.)
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