Auto industry giant Stellantis, the maker of iconic brands like Jeep, Dodge, Fiat, Chrysler, and Peugeot, announced a significant move this week: the suspension of its full-year financial guidance. This unexpected decision stems directly from the lingering uncertainty surrounding the impact of former President Donald Trump’s fluctuating trade policies, specifically the tariffs imposed on imported vehicles and auto parts.
The company reported first-quarter net revenues of €35.8 billion ($40.7 billion), a concerning 14% decrease compared to the same period last year. Stellantis attributed this decline primarily to lower shipment volumes, unfavorable regional sales distribution, and price adjustments. While slightly below analyst expectations of €35.4 billion, the results also highlighted early signs of a commercial recovery.
Despite these early positive indicators in other key performance areas, the looming question mark of the Trump-era tariffs forced Stellantis’ hand. The company’s CFO, Doug Ostermann, stated that the decision to withdraw full-year guidance was a direct consequence of the tariff-related uncertainties. Stellantis emphasized their active engagement with policymakers to address these ongoing tariff concerns.
This announcement comes on the heels of a recent executive order signed by President Trump aiming to slightly ease some of the auto tariffs. While the 25% tariff on imported vehicles remains, the order seeks to reduce the overall impact of duties by preventing the ‘stacking’ of tariffs from various levies, such as those on steel and aluminum. However, additional 25% tariffs on auto parts, scheduled to begin on May 3rd, will still be implemented. The order does offer partial reimbursements for vehicles that undergo final assembly in the US for a two-year period.
The situation highlights the ongoing volatility and unpredictable nature of trade policy, particularly its profound influence on global corporations like Stellantis. The company’s decision to halt its financial projections underscores the significant challenges faced by businesses navigating the complex landscape of international trade relations. The coming months will be crucial in determining how these tariff adjustments ultimately affect Stellantis and the broader automotive industry.
