Shares plummet!

Car crisis in Europe: Industry giant pulls the plug

Due to the curtailment of development plans for electric cars, costs of around €22.2 billion were incurred in the second half of 2025, according to the French-Italian car manufacturer on Friday.(Bild: AFP/FREDERICK FLORIN)

On Friday, there was a remarkable crash on the stock market! The reason: Stellantis, the parent company of Fiat and Chrysler, is pulling the plug on its electric strategy and posting write-downs in the billions. This will result in a preliminary loss of €19 to €21 billion for this period. 

The bad news caused Stellantis shares to plummet by more than 25 percent at times on Friday – and there seems to be no end in sight to the sell-off. The crash also weighed on other French industry stocks: Valeo, Renault, and Forvia shares fell between 2.1 and 2.5 percent.

In Germany, too, other industry giants were among the losers: Volkswagen lost 2.3 percent on the DAX, BMW 1.5 percent, and Porsche even 3.2 percent on the MDAX.

No dividends for investors
Shareholders are now set to come away empty-handed: Stellantis will not be paying a dividend this year. "The company has made the vast majority of the decisions necessary to correct its course," said a statement from the automotive giant. The main focus is on adapting the product portfolio to market demand.

Stellantis is following in the footsteps of its US competitors Ford and General Motors. They too had abandoned their ambitious plans for battery-powered models due to the policies of the US government under Donald Trump and weak demand for electric cars.(Bild: AFP)

The write-offs are the result of Stellantis overestimating the pace of the transition from gasoline and diesel to electric powertrains, "which has distanced us from the needs, capabilities, and desires of many car buyers in the real world."

Another reason for the billions in losses: the policies of US President Donald Trump. He is focusing on combustion engines rather than electric cars. This is weighing on the important US sales market. In recent years, however, Stellantis has concentrated fully on electric mobility and invested a lot of money. Now it has to backtrack (for the time being) and look for new ways out of the crisis.

Since Friday morning, the company has been in a steep decline: 

5-day performance of Stellantis shares(Bild: Wiener Börse)

Battery plant to be sold
As part of its realignment, Stellantis is selling its stake in a battery plant in Canada to South Korean battery manufacturer LG Energy Solution for a symbolic price of $100 (€85). To date, more than five billion Canadian dollars (€3.1 billion) have been invested in the site.

The automotive industry – especially in Germany – is in crisis. According to a study by consulting firm EY, companies are currently earning less than they have in more than a decade and a half. Many companies in Austria supply the German and international automotive industry.

Stellantis

The European-American automotive and mobility group Stellantis comprises 14 car brands, including well-known names such as Peugeot, Citroën, Opel, Fiat, Jeep, Alfa Romeo, Maserati, Dodge, Ram, Lancia, DS Automobiles, Abarth, Vauxhall, and the mobility services of Free2move.

Automotive industryunder pressure
The European automotive industry isunderenormouspressure: weak demand, high energy and labor costs, stricter EU CO2 regulations, and aggressive competition from China in the electric segment are putting margins under stress. At the same time, the expensive technological shift to e-mobility and software integration is forcing many manufacturers to take tough structural measures and cut costs in order to remain competitive.

A "Made in Europe" strategy is intended to strengthen the industry and ensure its competitiveness in the future, as well as to ensure more production and investment and fair competition.

• One demand is that vehicles for the EU market should be more closely linked to European production requirements.

• Every manufacturer selling in Europe should be required to produce under comparable conditions.

• In addition, government subsidies should specifically support European value creation, and a CO2 bonus should be paid for each electric car. These should also receive a label and benefit from government purchase premiums or public contracts, for example.

Stellantis, like BMW, for example, had advocated a move away from combustion engines as a traditional car manufacturer. The reason: demand for electric cars is growing more slowly than originally assumed due to inadequate charging infrastructure. 

Production in Italy down 20 percent
On January 7, it was announced that production in Italy alone had fallen to 379,706 vehicles (20 percent), with only the Turin plant recording an increase (up 16.5 percent).

Ferdinando Uliano, head of the Italian Metalworkers' Union (FIM CISL), emphasized that production had halved in less than two years – in 2023, 751,384 vehicles had been manufactured. He underscored the need for investment and new models.