Stellantis announced a significant business reset, expecting a €22 billion impact, as it adjusts its electrification strategy and halts dividends to preserve financial stability.

Target Company Overview

Stellantis, a prominent global automaker, has recently faced significant challenges, resulting in a staggering 27% drop in its shares during European trading. The company has announced a substantial restructuring that will incur an estimated cost of 22 billion euros (approximately $26 billion). This business reset comes alongside a cautious approach towards its electrification initiatives, with CEO Antonio Filosa acknowledging a misalignment between previous strategies and customer needs. The company's shares in Milan fell by 25%, while its New York-listed stocks dropped by 23%.

In efforts to address operational inefficiencies and adapt to market dynamics, Stellantis is taking substantial measures, including halting dividends for 2026 and planning to issue hybrid bonds worth up to 5 billion euros. The automaker intends to maintain a leading position in the electric vehicle (EV) sector while adjusting the pace of its electrification strategy to better align with consumer demand.

Industry Overview in Europe

The European automotive industry has been undergoing a gradual yet significant transition towards electric mobility. As regulatory pressures increase and consumer preferences shift towards sustainable options, traditional automakers fi