The finance chief of global automotive group Stellantis N.V. said Nov. 3 that the company doesn’t see its supply chain becoming trouble-free at least until we turn the page into 2024.
Speaking to analysts after the Amsterdam-headquartered parent of Chrysler, Jeep and other brands reported third-quarter revenues, CFO Richard Palmer said his team sees things getting better on some fronts – its supply of semiconductors improved somewhat in Q3 – but remaining a problem in other ways. The company also has, in line with its largest North American competitors, been dealing with transportation issues and helping suppliers deal with their own supply chain headaches.
“We are implementing various short-, medium- and long-term actions to better protect supply,” Palmer said, adding that the chip situation is a bit worse in North America than in Europe. “We believe that we will continue to see sequential improvements but we don’t expect the situation to be back to normal before the end of next year.”
Stellantis booked total revenues of about $41.2 billion in the three months ended Sept. 30, a solid increase of 29% from the same period of 2021, as the company’s total shipments rose 13% to more than 1.3 million. In North America, revenues were up 36% to $20.7 billion and shipments rose to 441,000 from 394,000 a year earlier but sales slipped 4% to 445,000.
Palmer noted that the company has been able to raise the average price of its vehicles to offset many cost pressures and expects to be able to continue to do so in 2023. (“I don’t expect any price reversal. We need to be very disciplined on pricing,” he said. “If we’re suffering, then others will be suffering more.”) For the year, his team is still forecasting that North American sales for the full year will be down about 8% from 2021. The main culprit for that drop are those supply chain issues that aren’t letting Stellantis (and several of its peers) meet demand that remains strong.
“Our vehicles are turning very fast on dealer lots,” Palmer said. “The real constraint at the moment continues to be supply due to semiconductors but also due to some logistics challenges both for us and for our suppliers in the North America market.”
Shares of Stellantis (Ticker: STLA) were down more than 3% to roughly $12.90 in morning trading Nov. 3. They’ve lost about 7% of their value over the past six months, trimming the company’s market capitalization to about $41 billion
