Stellantis Turnaround: Early Wins, Big Challenges Ahead

Stellantis is demonstrating early signs of a turnaround, highlighted by €828 million in year-over-year industrial cost improvements during the third quarter. The automaker's U.S.-listed shares saw a notable jump following these positive results.

While revenue increased by a modest 1% to approximately €37.6 billion, the emphasis on cost control, particularly through purchasing efficiencies and its Value Creation Program, was a key driver. Management anticipates these savings to accelerate in the fourth quarter, aiming for a €6 billion annual run-rate efficiency target by 2028.

A significant regional shift occurred, with North America moving from a €475 million adjusted operating loss in Q3 2025 to a €64 million profit this year. Conversely, the Enlarged Europe segment faced a deterioration, swinging from a €157 million profit to a €311 million loss, impacted by higher EV sales and pricing pressures.

The company reported adjusted operating income of €256 million, up from €90 million a year prior, but the overall adjusted operating margin remained a slim 0.7%. Industrial free cash flow was negative €4 billion for the quarter, attributed to seasonal working-capital movements. Stellantis reaffirmed its expectation of positive industrial free cash flow by 2027.