Stellantis’ €22.2 Billion Charges Reveal Cost of Resetting Auto Strategy
Key Facts
Stellantis announced charges of about €22.2 billion for the second half of 2025 as it resets its strategy in response to customer preferences and new emissions rules, according to preliminary results. The company said the charges are excluded from adjusted operating income and include expected cash payments of about €6.5 billion over the following four years. The move reflects the company’s reduced expectations for electric vehicle products and a restructuring of related supply chain capacity. Chief Executive Antonio Filosa described one of the reasons as “overestimating the speed of the energy transition.” The review comes as European companies recalculate their electric vehicle plans amid strong competition, operating costs and trade pressures.
According to the annual results announced by Stellantis, net revenue was €153.5 billion in 2025, down 2% from the previous year, and the company posted a net loss of €22.3 billion. The company attributed the loss to annual exceptional charges of €25.4 billion, a figure covering the full year and distinct from the approximately €22.2 billion in charges for the second half. Stellantis ended the year with available industrial liquidity of about €46 billion, but said it would not pay dividends in 2026. Its board also authorized the issuance of hybrid bonds worth up to €5 billion. These measures show how the reset combines a review of products with liquidity protection and financing for the operational transition.
At Volkswagen, the group’s operating result fell to €8.9 billion in 2025, from €19.1 billion in 2024, and its operating return margin declined to 2.8% from 5.9%. The group attributed the decline to U.S. charges and expenses related to adjusting Porsche’s product strategy, as well as currency, pricing and product mix effects. It said cost-cutting programs offset some of these burdens. This puts pressure on profitability in a context different from Stellantis’ charges, as Volkswagen’s results highlight a mix of trade costs, product adjustments and market effects. The group’s plan, approved later, included cutting about 50,000 jobs and addressing excess production capacity of 500,000 vehicles in Europe.
The review of companies’ plans does not mean Europe’s electric vehicle market contracted in 2025: global sales rose 20% to more than 20 million cars, while European sales increased by more than 30% and electric vehicles accounted for 28% of new car sales in the region, according to the International Energy Agency. At the same time, Chinese automakers supplied 60% of global electric vehicle sales that year, putting competition over market share and cost at the center of the picture. In the first half of 2026, new car registrations in the European Union rose 5.7%, but global registrations fell 4.9% to 35.7 million units. EU car exports also fell 5.9% by volume. The European Automobile Manufacturers’ Association said EU economic growth in 2026 is expected to be 1.1%, 0.3 percentage points below its previous forecast, with headline inflation expected at 3.1%.
The consequences of the transition extend beyond company balance sheets: Europe’s automotive sector employs about 14 million people and operates more than 250 plants across the continent, according to the European Automobile Manufacturers’ Association. Volkswagen’s supervisory board had approved its 2030 plan on 3 September 2026, anticipating adjustments to about 50,000 jobs across the group and addressing excess European production capacity. As part of labor talks, the company said its representatives and representatives of the IG Metall union would meet on 23 October 2026 to review the future labor agreement. The next round of collective bargaining is scheduled to begin no later than early December. Stellantis, meanwhile, set its investor day for 21 May 2026 to present details of its new strategy, in an event it said would clarify the path for resetting the business.