Stellantis Now Expects FY24 Operating Margin Of 5.5%-7.0%, Down From Its Prior Double-Digit Growth Expectations, And Industrial Free Cash Flow Of €(5)B-€(10)B Versus Prior Expectations Of Positive Cash Flow Due To Corrective Actions in North America And Global Industry Dynamics

Stellantis N.V. today revised its 2024 financial guidance, reflecting decisions to significantly enlarge remediation actions on North American performance issues, as well as deterioration in global industry dynamics.

The Company has accelerated its planned normalization of inventory levels in the U.S., targeting no more than 330,000 units of dealer inventory by year-end 2024, from a prior timing objective of the first quarter of 2025. Actions include North American shipment declines of more than 200,000 vehicles in the second half of 2024 (up from 100,000 prior guidance), compared to the prior year period, increased incentives on 2024 and older model year vehicles, and productivity improvement initiatives that encompass both cost and capacity adjustments.

Deterioration in the global industry backdrop reflects a lower 2024 market forecast than at the beginning of the period, while competitive dynamics have intensified due to both rising industry supply, as well as increased Chinese competition.

The Company's updated 2024 market outlook and financial guidance is as follows:

• Adjusted operating income ("AOI") margin – Expected to be between 5.5 - 7.0% for the FY 2024 period, down from prior "double digit". Roughly two-thirds of the reduced AOI margin is driven by corrective actions in North America. Other contributors include lower than expected sales performance in the second half of the year across most regions.
• Industrial free cash flow – Expected to range from -€5 billion to -€10 billion, from prior "Positive". This primarily reflects the substantially lower AOI outlook as well as the impact of temporarily elevated working capital in the second half of 2024.

The Company will continue to leverage and expand its competitive differentiators and believes that the recovery actions being put in place will ensure stronger operational and financial performance in 2025 and beyond.