Stellantis Group recorded a second year of record profits in 2022 offsetting automotive market instabilities with price increases. This is a 26% increase in net profit over one year, announced on Wednesday the automotive group born in 2021 from the merger of PSA and Fiat-Chrysler. Only hydrocarbon giant TotalEnergies has done better in the CAC 40 so far in 2022, with a net profit of $20.5 billion. Stellantis’ operating margin reached 13% of revenue in 2022, almost at the level of Tesla or Mercedes. The group with fourteen brands recorded a net increase in turnover (18%) to 179.6 billion euros.
Price increases, cost-hunting and a strong dollar more than offset a drop in the number of vehicles sold in Europe. For 2023, the group expects the automotive markets to recover slightly (5% in Europe and North America), and still aims for a double-digit operating margin. The effect of inflation and increases in raw material costs should be “softer”, and issues with delivering vehicles to dealerships resolved in the first half.
Will the situation get more complicated then, if car prices go down? “We are witnessing a rebalancing between supply and demand”, commented the group’s general manager, Carlos Tavares, during a press conference. “It is normal that our latitude to set prices is under pressure […] We therefore need to reduce production costs even more quickly […] and with our order books full, and the attractiveness of our new models, we have some time to adapt,” he added. With a less chaotic market, the group’s margin has already declined slightly in the second half of 2022 in North America.
On the strength of its results, Stellantis will distribute 4.2 billion euros in dividends to its shareholders, or 1.34 euros per share. Two billion euros will also be donated to its 264,000 employees around the world. In France, employees will benefit from a minimum of 4,300 euros gross – 3,882 euros net –, i.e. 300 euros more than in 2022, which represents “2.4 months of salary for the first levels of remuneration”, from after the group. “This is the most important redistribution for ten years”, underlined the director of human resources (HRD) World Xavier Chéreau during a press conference. At most, a French employee will be able to receive 6,190 euros gross, said HRD France, Bruno Bertin.
“It’s not nothing,” admitted CFTC central union representative Frédéric Lemaytch to AFP. “It’s the largest sum we could have had and with still a lot of headwinds, we manage to ensure that employees receive more than last year,” he recalled. In addition, the group sent a signal to the markets by announcing the buyback of 1.5 billion euros in shares by the end of 2023. “These new robust figures should reassure investors about the manufacturer’s resilience in a environment that will potentially become less favorable,” Oddo BHF analysts noted in a note. The group’s share ended up on the Paris and Milan Stock Exchanges (2.2%), at 16.22 euros. Stellantis, however, recorded a sharp decline in sales in its largest market, Europe, to 2.6 million units (–8%). This decline affected most of its brands, with sales of the Peugeot 308, Fiat Panda and Citroën C5 X not compensating for the logistics problems. But the group was able to maintain its margins, in particular with price increases and new electric and hybrid models sold at a higher price.
It is on the North American market that it progressed, with 1.8 million vehicles sold (2%) and a turnover of 85 billion euros (23%). The group sold 288,000 electric vehicles in 2022, an increase of 41%. It is hot on the heels of Tesla in electric sales in Europe and intends to multiply launches in the coming months. “We now have the technology, products, raw materials and complete battery ecosystem to drive this same transformation in North America, with our first all-electric Ram vehicles in 2023 and Jeep in 2024,” stressed in a press release Carlos Tavares.
