Leadership changes at major corporations often send shockwaves through the industry, and the recent departure of Carlos Tavares from Stellantis is no exception.
Officially, he stepped down. But insiders suggest his exit wasn’t entirely voluntary.
Tavares, who had just over a year remaining on his contract, left his role as CEO after months of internal disagreements with the company’s board, according to Boosted.
The decision surprised many, especially given that he had received public support from leadership only weeks earlier.
Agressive Cost-Cutting
According to Reuters, the primary issue was a clash over strategy. Tavares proposed aggressive cost-cutting measures in Europe to address Stellantis’ financial struggles.
His plan included significant reductions that key stakeholders, including representatives of the Peugeot family, were unwilling to endorse.
The Peugeot family, one of the automaker’s largest shareholders, had previously backed Tavares. But falling profits and mounting pressures on the company led to growing dissatisfaction with his leadership.
It wasn’t just strategy that caused tension. Sources close to the matter cited Tavares’ communication style as a factor.
He was known for dismissing criticism, and his blunt approach didn’t sit well with some board members.
At the Paris Motor Show earlier this year, Tavares reportedly told colleagues, “Don’t interfere with my work—that’s not your place.”
Statements like this are believed to have contributed to the decision to remove him.
For now, Stellantis Chairman John Elkann has stepped in as interim CEO. Elkann, who holds a prominent position in the Fiat family’s ownership of the company, faces immediate challenges.
Stellantis is grappling with declining profits, unsold inventory in the U.S., and stricter climate regulations in Europe. The company’s stock has fallen 43 percent since the start of the year, reflecting growing investor concerns.
Tavares departed with an annual salary of approximately £31.7 million GBP (CAD 54.5 million). While details of his severance package remain undisclosed, his sudden exit leaves Stellantis at a critical crossroads.
