Why did Stellantis boss Carlos Tavares resign? And what did he achieve?

The global boss of mega-conglomerate Stellantis, Carlos Tavares, has suddenly resigned. Or been pushed. There is no official line on why, other than that he and most of the rest of the board had a disagreement over strategy.

But we have a pretty strong clue what that was about. And TopGear.com doesn’t want to see him off without marking his immense achievements.

Stellantis is the huge company that resulted when PSA merged with FCA in January 2021. To explain further, PSA was Peugeot, Citroen and DS, later including Vauxhall and Opel. That was the group Tavares was in charge of. FCA itself was the result of a merger, between a European combine – Fiat, Alfa Romeo, Maserati, Abarth and Lancia – with the US group of Jeep, Dodge and Chrysler. It’s a sprawling enterprise, still not fully integrated.

In an official statement this week, Stellantis senior independent director Henri de Castries said very little. “In recent weeks different views have emerged which have resulted in the board and the chief executive coming to today’s decision.” That decision being Tavares’ departure.

The ‘different views’ stem from the fact the company’s Detroit-based brands have been losing sales in the huge and profitable US market this year. Unsold cars were piling up at dealers there.

When I saw Tavares a month ago, he said he’d given the Detroit management too much power, and they’d lost control of the situation. Their “daring marketing plan”, he said, had failed. This autumn the head of the US division got sacked; Tavares survived.

But he couldn’t fix the problem or repair relationships with dealers, which partly stemmed from the fact the vehicles were too expensive. Lots of cheaper petrol-engined models had gone out of production with no direct replacements.

Stellantis issued a profit warning and the stock price fell. Great way to annoy the shareholders. This, it’s very likely, is the cause of his exit.

OK, let’s look at what the guy did. He is a great petrolhead, often racing and rallying at weekends. He was a late convert to electric drive, and embraced it pragmatically. His EV platforms, including the one under the Peugeot e-3008, can also run on petrol.

He is a strong advocate of action on climate change, but also hates regulations that, as he sees it, pushes up car prices for ordinary people. The fact the same rules can erode car company profits also drives his arguments, of course.

He has an astonishing ability to spot cost savings, whether in factories or in the supply chain or distribution network. Boring to the likes of us, but critical to making enough money to launch good new cars.

He was always nakedly ambitious too. Having started at Renault he transferred to Nissan, and by 2011 was number two at Nissan. He made the mistake of saying, when asked, that one day he’d like to run the company. The man actually running the company at the time, Carlos Ghosn, took the hump and Tavares was very rapidly shown the door. An example of how the fate of car companies do turn on the vastness of the egos at the top.

Tavares soon found a new berth, in 2014, at the top of PSA. At the time it was in immense trouble. He rapidly turned it around, with financial discipline but also vastly improved cars. He wanted to shift upmarket and founded DS, always saying it’d take a long time to get fully established.

Then in 2017 he bought Vauxhall and Opel from GM. To some (including me, and I told him so) it looked like lunacy, as GM had lost money on those for decades. Yet again he made the turnaround, by moving fast to integrate them onto PSA’s engineering.

More drama followed when PSA and FCA joined three years ago. It was called a merger but PSA was the healthier outfit at the time. It was going to need speed to bring the operations together, but the ex-Chrysler Group is very different from the European operations and there’s not a whole lot of potential shared efforts. Even in Europe the Fiat, Alfa and Maserati parts remain distinct from the ex-PSA bits.

We don’t yet know who’ll replace Tavares. Perhaps one company with so many brands – Tavares even bought a stake in China’s Leapmotor – is just too big for a single brain to run, even a very big one.