The electric car crisis is sparking calls for Vauxhall owner “Frankenstein” to be broken up

However, as with many leaders, the qualities for which Tavares was praised at the height of his power are now being blamed for his downfall.

In July it became clear that Stellantis was in deep trouble when the company announced that half-year profits had slumped from €10.9bn (£9.1bn) to €5.6bn.

Worse, many of the problems appeared to have their roots in the CEO’s tough stance. Critics complained about stagnating product ranges, high prices, poor quality and declining market shares in almost all regions.

According to Jato Dynamics, the company’s share in Europe and Turkey has fallen from 22.3 percent to 19.3 percent since 2020, while its share in North America fell from 12.4 percent to 9.7 percent.

In China, the small share of 0.5 percent shrank further to 0.3 percent over the same period. The only bright spot is in the Middle East and Africa, where it rose from 3.7 percent to 4 percent.

Tavares, who said he was humbled by the July numbers, attributed the problems to a “bump in the road” and immediately set about reshuffling executives and enforcing stricter discipline – suggesting he was determined to to stay there.

But the dismal results were followed by a profit warning in September that wiped 50 percent off the value of Stellantis shares. Then the company announced in October that Tavares would step down in early 2026.

The CEO’s fate was sealed on Sunday evening when the company confirmed his resignation following differences with the board over future strategy.

On Monday, insiders claimed Tavares had “moved too quickly to regain his reputation” and focused too much on the short term, managing to “upset everyone in the process,” according to the Financial Times.

Industry experts also pointed to a large number of disputes in which the CEO is involved worldwide.

In Italy, Stellantis engaged in a war of words with the government of Georgia Meloni over the company’s decision to move production of Alfa Romeo cars to Poland.

Ministers in the Meloni government accused the company of misleading consumers with the “Italian-sounding” name Milano for a foreign-made SUV model that was later renamed Junior.

The dispute is a thorn in the side of John Elkann, the head of the Agnelli family, who is also publicly criticized. According to Bloomberg, Elkann personally alerted Meloni to Tavares’ impending resignation.

Elsewhere, Stellantis has heavily criticized electric vehicle sales targets in the UK and recently announced the closure of its van factory in Luton.

And in North America – traditionally the largest market – Tavares was accused by dealers and unions of leaving brands like Chrysler, Dodge, Jeep and Ram in a “bloodless and weakened state” after mass layoffs, production cuts, disputes with suppliers and quality control problems.

In September, Stellantis was forced to recall 194,000 Jeep hybrid SUVs to address a fire risk related to a battery component.

In addition, Stellantis, like competitors such as Renault and Volkswagen, is fighting for market share worldwide, with Chinese low-cost brands leading the way in the electric vehicle (EV) segment.

“Carlos was attacked in Italy because the company was seen as more focused on France. Then he was attacked by the Americans, with Jeep virtually failing. So he has suffered from both geopolitical and property issues,” Palmer notes.

Many now expect Stellantis to struggle to revive itself while struggling under the weight of so many brands – not least similar mass-market brands such as Citroen and Fiat.

The transition to electric vehicles is forcing automakers that have perfected and outsourced their supply chains for decades to bring more production back in-house, while in China, Europe and the US – where Donald Trump is poised to destroy Joe Biden’s electric vehicle – different regulatory approaches are pursued mandate – create further complications.

Furthermore, many European companies simply cannot compete with their vertically integrated Chinese counterparts in terms of manufacturing costs.

Because of this, Volkswagen is experiencing a painful upheaval that could result in tens of thousands of workers being laid off and factories closing for the first time in Germany.

Given this, Jato’s Munoz says whoever takes over Tavares will inevitably consider closing or spinning off some of the brands currently sitting in the Stellantis tent.

“I expected him to do this when Stellantis was first created,” Munoz adds. “Because you know, 14 brands is too many, especially when many of them are direct competitors.

“There is no room for so many at the moment because the markets are saturated and the Chinese are coming.”

Another analyst agrees, saying: “They have kept costs in line, but they have failed to understand the brands.”

“How can you lose so much market share when you have so many brands? They don’t manage them well.”

Ultimately, Munoz says, Tavares’ greatest legacy will be the founding of Stellantis – but whether it survives the company’s next phase is up for debate.

“I think there will have to be big decisions soon,” Munoz added.

Nine months ago, it was a safe bet that Tavares would be the man to make them. Now someone else will try to control the monster they created.

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