European automotive giant Stellantis has reported a dramatic €20.1 billion net loss in the second half of 2025, marking a severe downturn for the group formed by the merger of Fiat Chrysler and PSA Group. The figures, unveiled on 26 February 2026, reflect the mounting cost of write-downs linked to a major reset of its electric vehicle (EV) strategy and other strategic shifts.
The headline loss comes after Stellantis booked €22.2 billion in charges and write-downs across the period, driven chiefly by the decision to scale back its ambitious EV programme and to realign its product plans with evolving consumer demand and regulatory environments. While net revenues for July–December 2025 rose by around 10 per cent year-on-year, the one-off costs wiped out operating profits and sunk the group deep into the red.
Misjudging the electric shift and quality issues
At the heart of Stellantis’ losses are the heavy impairments tied to its EV plans. According to the company’s own filings, around €14.7 billion of the charges relate to re-aligning product plans and impaired platforms due to significantly reduced expectations for battery-electric vehicles, particularly in the US market, where regulatory shifts and demand patterns have diverged from past forecasts. The write-downs included cancelled programmes and assets that will no longer deliver the expected returns.
Another significant chunk of the write-downs — €2.1 billion — stems from resizing the EV supply chain, including reductions to battery manufacturing capacities previously ramped up in anticipation of stronger demand. A further €5.4 billion covers operational changes such as revised warranty provisions and restructuring costs, with recent quality problems blamed in part on cost-cutting measures under previous management.
Stellantis CEO Antonio Filosa. Image: Stellantis
Stellantis CEO Antonio Filosa commented: “The reset we have announced today is part of the decisive process we started in 2025, to once again make our customers and their preferences our guiding star. The charges announced today largely reflect the cost of over-estimating the pace of the energy transition that distanced us from many car buyers’ real-world needs, means and desires. They also reflect the impact of previous poor operational execution, the effects of which are being progressively addressed by our new team”
He added: “We have gone deep into every corner of our business and are making the necessary changes, mobilizing all the passion and ingenuity we have within Stellantis. The positive customer reception to our product actions in 2025 resulted in increased orders and a return to top-line growth. In 2026, our unwavering focus is on closing past execution gaps to add further momentum to these early signs of renewed growth. We look forward to sharing the full details of our new strategy at our Investor Day on May 21.”
Market reaction and shareholder impact
The financial hit was felt in Stellantis’ share price, which has slid sharply following the announcements — losing more than 30 per cent year-to-date and hitting historic lows. The company also confirmed that it would suspend its dividend for 2026, choosing to preserve capital after such a significant loss.
Stellantis’ adjusted operating income for the second half was negative €1.38 billion, underscoring that the group’s underlying operations did not deliver enough profits to counter the exceptional write-downs.
Strategic reset and recovery plans
In response, Stellantis has embarked on what it describes as a “decisive reset” of its business, with a renewed focus on customer preferences and profitable growth. The company’s full-year 2025 results showed a net loss of €22.3 billion, with the larger figure reflecting other one-off items and FX headwinds over the entire year.
Key elements of Stellantis’ recovery strategy include broadening its product portfolio across global markets and reviewing its investment mix to favour segments where customer demand remains strong. The group has signalled a more cautious approach to electrification, balancing EV development with continued investment in hybrid and internal combustion engine (ICE) technology where market demand justifies it.
Stellantis reiterated its financial guidance for 2026, forecasting mid-single-digit percentage growth in net revenues and a return to a low-single-digit adjusted operating margin, with industrial free cash flows expected to turn positive in 2027. These projections hinge on successful execution of its reset and improved operational performance
The board has also authorised the issuance of up to €5 billion in hybrid bonds to bolster the company’s balance sheet and maintain industrial liquidity, which stood at approximately €46 billion at the end of 2025
Outlook and industry context
The setbacks at Stellantis highlight the broader challenges facing the global auto industry as it transitions to electrification. Misjudging the timing and scale of EV adoption, shifts in regulatory frameworks, and intensifying competition have made strategic planning increasingly complex. For Stellantis, recalibrating its EV ambitions while managing traditional product lines and regional market differences will be crucial to restoring investor confidence and long-term profitability.
As the company moves forward, it will pay close attention to how effective its strategic reset unlocks sustainable growth and whether the automotive titan can regain its footing in a sector undergoing rapid transformation.
