Impressive margins, record semesters: Stellantis is a good place to live
18% margin in the American market, record profits: Stellantis’ financial health is outrageous in times of crisis. Things are looking good in Europe too, albeit less conspicuously than in Uncle Sam’s country.
The past year has already been fruitful for Stellantis, but the auto giant appears to be on track for a historic fiscal 2022. crisis ? What a crisis! Component shortages, logistics problems, inflation, raw materials on the rise, the group was able to survive the hardships of the first half of the year to a balance sheet that would probably make some premium brands green with envy. But don’t forget, Stellantis isn’t just Peugeot and Citroën. It’s a monster of 14 brands that also has a presence in America. And this is where Stellantis works wonders!
The first half of Stellantis in numbers
- Sales: 88.0 billion euros (+17%)
- Operating income: 12.4 billion euros (+44%)
- Operating margin: 14.1% (double-digit margin for all five regions)
- Net profit: 8 billion euros (+ 34%)
- Available liquidity: 59.7 billion euros
The margin of 14% is simply impressive: that’s almost what Porsche achieved in the same period! But there’s still a big gap between the United States (more than 18% margin) and Europe (just over 10%).. The consequence of Jeep’s outrageous success on its own soil and a European market that tends to lean towards the lower segments (B and C), which are less profitable. Nevertheless, the “higher pricing” of the group’s brands pays off.
The Tavares Method, known for streamlining and reducing costs at all stages, is working at full speed. This raises the question of the difference between Stellantis’ margins in Europe and those of a Renault group. It is likely that one will benefit from products, platforms and mechanics that have already generated profits, while the other is in a phase of major investments (new hybrids at Renault, arrival of new generations of electric vehicles). At Stellantis Europe there is not much to say at the moment, apart from the group that has sunk in all sauces (with 50 kWh battery and 136 hp engine). And in the next few months The only really big electric announcements are for the US market with “Dodge Speed Week” in mid-August and the Ram Revolution in November. The opportunity to discover the beginnings of the group’s future “muscle cars” and electric pickups.
A shadow is to be noted on the blackboard: a 2022 forecast of -12% for Europe and -8% for the United States. Numbers more pessimistic than at the end of the first quarter, when Stellantis predicted a stable situation for America and a small -2% for Europe. Finally, signs that the overall trend is deteriorating. But at Mercedes everything is a matter of “pricing”: if the cars sold are expensive enough, they will make it possible to compensate for the drop in sales, and much more.
