The French-Italian company's broad portfolio, the largest among competitors that focus on only one or two brands, reflects its origins in the 2021 merger between Fiat-Chrysler and Psa, owner of Peugeot. A reduction in the range of brands could reduce complexity and allow some marketing, development, and sales functions to be merged.
But each brand has its own supporters: from the beloved Jeep, Ram and Peugeot to the more struggling brands such as DS, Lancia and Alfa Romeo. It is by no means easy to decide which one to leave behind.
In Europe, for example, where Stellantis the second-largest automaker after Volkswagen, its top-selling brand Peugeot recorded a market share of just 4.9 percent last year, ranking eighth overall.
The fact that the Stellantis corporate name is less recognizable to consumers than competitors such as VW or Toyota is an additional disadvantage.
A source familiar with Elkann's plans told Reuters that brand organization is a priority issue and any CEO candidate without a clear idea about it "is not the right candidate."
Former CEO Carlos Tavares has often said that traditional automakers face a "Darwinian era" in which the weakest is doomed to fail, insisting, however, that all Stellantis brands have a future ahead of them.
When Tavares was forced to resign in December, Elkann moved quickly to rebuild investor confidence that had been damaged by the sharp drop in sales and profit margins in the traditionally most profitable U.S. market with the Jeep, Ram, Chrysler and Dodge brands.
The world's fourth-largest automaker in terms of sales fared worse in Europe. Three years ago it had entered into a joint venture to produce Jeep in China, but does not intend to revive it given dwindling local opportunities.
The new CEO must "be ready to make important decisions," said Fabio Caldato of Acomea Sgr, which holds shares in the Stellantis group.
"If I am not reasoning from the heart, but thinking instead as an investor, I would see very positively the fact that the new CEO is determined to review the brand portfolio," Caldato added.
Brands that analysts see as vulnerable to a reorganization of the brand portfolio include premium brands Alfa Romeo, DS, and Lancia. Dodge and Chrysler, on the other hand, are considered the brands to be saved, despite a less than stellar performance, due to their visibility among U.S. motorists and their appeal to specific market segments.
In the past, automakers that have abandoned famous brands have done so reluctantly, as when GM eliminated Saturn and Pontiac or when Ford closed Mercury during the recession of the late 2000s.
In a note to Reuters, Stellantis said that each of its brands has new product plans and that recent organizational changes are aimed at supporting them.
"Stellantis aims to provide its customers with an even broader range of choices by leveraging the long history and strong identity of its 14 brands," the note said.
"MAGIC WAND"
A source inside Stellantis said brand portfolio issues are known in the group, but that the spread of individual brands in certain countries or market segments makes it far from clear which ones to cut.
Jeep and Ram are Stellantis' top-selling brands in the U.S., while Chrysler (now partly limited to the Pacifica minivan) and Dodge each sold fewer than 150,000 vehicles in the U.S. last year. Dodge's product lineup has shrunk to a muscle car, the Charger, a sports crossover, and an SUV.
According to Reuters calculations, Jeep accounted for at least 15 percent of Stellantis global sales in 2024, while Chrysler and Dodge each accounted for about 3 percent.
"If I had a magic wand ... I would probably say Jeep should absorb Chrysler and Ram should absorb Dodge," said Erin Keating of research firm Cox Automotive.
"But the savings would still not be much," Keating added, because the four brands "each have their own brand equity," are complementary in terms of range, and share the same dealerships.
Last year Stellantis ranked fifth in the U.S. market in terms of sales, with an overall share of 8.1 percent, losing fourth place to Honda as a result of price increases, which led to the profit warning that caused Tavares to leave. Jeep ranked 11th as a single brand, with a market share of just under 4 percent.
According to Keating, the company's goal should now be to bring prices back in line with what customers are willing to pay, a view shared by U.S. dealers.
"We're trying to find a way to bring back these historic brands," said David Kelleher, owner of a Chrysler-Dodge-Jeep-Ram store near Philadelphia.
EUROPEAN CHALLENGE.
The biggest challenge could be Europe, where Stellantis-slowly moving forward on electrification-face strict carbon emission standards and stiff competition from China.
"It would be a problem if Stellantis closed its brands," said Tony Fassina, owner of a dealership that sells Fiat and Alfa Romeo in Milan. "You would definitely face a drop in sales."
Marco Santino of consulting firm Oliver Wyman believes that some Stellantis brands such as Peugeot and Opel overlap in the European mass market segment, while Stellantis is struggling in the premium market.
Alfa Romeo, Lancia and DS, focused on the European market, have only captured a 0.3 percent market share in the region in 2024, well below competitors such as Audi and Bmw. Peugeot in comparison made one-fifth of the company's global sales.
Santino suggests that Alfa could become a niche sports brand as the average loyal customer ages. Any broad repositioning to revive the premium brand "has to be done ... from scratch."
Stellantis aims to launch about 20 new or updated models between late 2024 and 2025, mostly electric and hybrid vehicles, including the Citroen C3, which is expected to be the most affordable European-made electric vehicle.
Its joint venture with Leapmotor, which can sell, import, and manufacture Leapmotor's Ev models outside China and is sometimes described as the 15th Stellantis brand, could be another boost to create electric models.
Fiat, Stellantis' international bestseller, is widespread in emerging markets such as Brazil or Turkey, and in the European city car segment with the 500 model. According to Santino, Fiat could focus on affordable models, while another brand could focus on electric vehicles.
"Markets are changing fast and less predictably than expected," Santino added. "Maybe not now, but in a few years yes the time will be ripe and Stellantis may close some brands."
(Giulio Piovaccari, translated by Jasmine Mazzarello, editing Antonella Cinelli)
