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May 15, 2021 12:00 AM

Tavares gives Stellantis brands 10 years to prove themselves

The automaker's CEO says he is affording each of the new company's 14 brands a decade to execute a successful business plan

Vince Bond Jr.
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    Stellantis CEO Carlos Tavares says the brands will get funding and the chance to build and carry out a long-term vision.

    Fiat Chrysler Automobiles is no more, but Fiat and Chrysler have been given at least another decade to show they are worth keeping around.

    Stellantis CEO Carlos Tavares says he is affording each of the 14 brands melded together from FCA and PSA Group a 10-year window to execute a business plan.

    For Chrysler, a brand in need of direction and more products, looking to 2031 is a tall task. With a lineup of only two minivan nameplates and the aging 300 sedan, making it that far without a major infusion of metal will be difficult.

    Interim Chrysler chief Tim Kuniskis, if he remains in the role, will have his work cut out for him in forging a game plan for the brand that will hit the century mark in 2025. But whoever has the reins in the coming years, it appears they will be given the opportunity to put Chrysler on a different path.

    Some say the brand is vulnerable and needs to find a purpose. Others, including dealer council Chairman David Kelleher, believe Chrysler could use a crossover and even another car — possibly on a PSA platform — to flesh out the lineup.

    Don't ‘kill what you love'

    Instead of making any immediate decisions, Tavares is giving brand leaders 10 years, during which they will have funding along with the chance to build and carry out a long-term vision. "We love them all," Tavares said of the brands. "You do not kill what you love."

    Brand heads will be given an opportunity to "plan for the different product launches and different technologies to make the brand grow, or the brand rebound, and create value for the company so they have a chance," Tavares said last week during Automotive News' Congress Conversations series.

    Tavares believes giving executives a decade to execute a vision is unique in the industry.

    "How many brand CEOs in the world have visibility of a 10-year funding for technology and product to organize the growth?" he asked. "That is what we are giving them so they have a chance. If they win, we will applaud. If they lose, then we will see what we do."

    Diversity ‘big strength'

    Tavares touched on a variety of topics during the interview, including his outlook on China, the development of the merged company's culture and how Stellantis completed the union two and a half months sooner than planned.

    Preparations for the blockbuster merger had to be carried out during a pandemic that upended society and forced the auto industry to adjust how it produced and sold vehicles. The FCA and PSA teams, who Tavares said were tremendously efficient, were able to complete the tie-up quicker than anticipated despite a process that included the filing of 12,500 documents from December 2019 to January 2021.

    Four months into the merger, Stellantis' culture is taking shape. But Tavares says it will take time to define.

    When a company executive asked him what the culture is, he answered: "One that we will select after a few years of working together."

    Whatever emerges will be derived from diverse viewpoints gleaned from those who have operated around the globe.

    This diversity, Tavares said, is a "big strength" because it gives the company "a higher capability to understand the world and understand the markets in which we are operating, and it also brings more different ideas and angles from which we can look at the problems and make the best possible decisions for the company."

    For the time being, Tavares said, "we do not try to figure out what is our culture. We just consider that being diverse is a competitive edge, and we are happy with that."

    Regions for growth

    Looking ahead, Tavares sees Africa, Asia, Latin America and the Middle East as regions where Stellantis can continue to grow.

    He said the company already is strong in Latin America, where it's a market share leader, but he said it can still be more efficient there. In Africa and the Middle East, Stellantis is gaining market share and has "very significant plans to enhance the capability to source in the region for the region," he said.

    India is progressing, but the automaker is looking to address weakness in China.

    "We are now, as you know, reengineering completely our strategy in China, as it has not been successful both for FCA and PSA in the past," Tavares said. "So we are now negotiating and changing very many things at core — not on the surface, but at core."

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