Q1 2025 Stellantis NV Earnings Call

April 30, 2025

Okay.

Yes.

Okay.

Hum.

<unk>.

Hum.

Okay.

Sure.

[music].

Okay.

[music].

Operator 1: Ladies and gentlemen, welcome to the Stellantis Q1 2025 Shipments and Revenues Call. I will now hand you over to your host, Mr. Ed Ditmire, Head of Investor Relations at Stellantis. Mr. Ditmire, please go ahead.

Operator: Ladies and gentlemen, welcome to the Stellantis Q1 2025 Shipments and Revenues Call. I will now hand you over to your host, Mr. Ed Ditmire, Head of Investor Relations at Stellantis. Mr. Ditmire, please go ahead.

Speaker Change: Ladies and gentlemen, welcome to the Sterling to its first quarter of 'twenty to 'twenty five shipments and revenues Cole.

Admire: I will now hand, you over to your host Mr. Admire.

Admire: That's does relations that's Atlantis Mr. <unk>. Please go ahead.

Doug Ostermann: Hello, everyone, and thank you for joining us today as we review Stellantis' Q1 2025 shipments and revenue update. Earlier today, the presentation for this call, along with the related press release, were posted under the Investors section of the Stellantis website. Our call is hosted today by Doug Ostermann, Chief Financial Officer at Stellantis, and after prepared remarks, he will be available to answer questions from the analysts. Before he begins, I want to point out that any forward-looking statements we might make during today's call are subject to the risks and uncertainties mentioned in the safe harbor statement included in page 2 of today's presentation. As customary, the call will be governed by that language. Now, I'll hand the call over to Doug. Thank you, Ed, and hello to everyone. Thank you for joining the call today.

Ed Ditmire: Hello, everyone, and thank you for joining us today as we review Stellantis' Q1 2025 shipments and revenue update. Earlier today, the presentation for this call, along with the related press release, were posted under the Investors section of the Stellantis website. Our call is hosted today by Doug Ostermann, Chief Financial Officer at Stellantis, and after prepared remarks, he will be available to answer questions from the analysts. Before he begins, I want to point out that any forward-looking statements we might make during today's call are subject to the risks and uncertainties mentioned in the safe harbor statement included in page 2 of today's presentation. As customary, the call will be governed by that language. Now, I'll hand the call over to Doug.

Speaker Change: Hello, everyone and thank you for joining us today as we review just Atlanta says Q1, 2025 shipments and revenue update earlier today. The presentation for this call along with the related press release were posted under the investors section of the Atlantis website. Our call is hosted today by Douglas instrument Chief Financial Officer at Atlanta.

Speaker Change: After our prepared remarks will be available to answer questions from the analysts.

Speaker Change: Before he begins I want to point out that any forward looking statements we might make during today's call are subject to the risks and uncertainties mentioned in the Safe Harbor statement included in page two of today's presentation as customary the call will be governed by that language now I'll hand, the call over to Doug.

Doug Ostermann: Thank you, Ed, and hello to everyone. Thank you for joining the call today.

Doug: Thank you, Ed and Hello to everyone and thank you for joining the call today.

Doug Ostermann: The theme at the top of the page is Focused on Execution, which I think is a way of saying that we're focused on things that we can control amidst what is a very turbulent backdrop. There are three important topics we want to cover today. First is the top-line performance in Q1 in terms of revenue and shipments, which was difficult and not where we want to be. At the same time, we are seeing important progress resulting from our commercial recovery actions. Second, we're executing well on the start of our 2025 new product wave, filling in product gaps and expanding our opportunities. Third, I'll discuss how the company is positioned vis-à-vis the tariff dynamic and the management team's focus on reducing these impacts. Now, let's look at a summary of today's presentation.

Doug: <unk> at the top of the page is focused on execution, which I think is a way of saying that we're focused on things that we can control amidst what is a very turbulent backdrop.

Doug: There are three important topics, we want to cover today.

Doug: First is the top line performance in Q1 in terms of revenue and shipments, which was difficult and not where we want to be at the same time, we're seeing important progress, resulting from our commercial recovery actions.

Doug: Second we are executing well on the start of our 2025, new product wave filling in product.

Doug: Product gaps and expanding our opportunities and third I'll discuss how the company is positioned vis vis the tariff dynamic and.

Doug: And the management team's focus on.

Doug: Reducing these impacts.

Doug: Now, let's look at a summary of today's presentation first.

Doug Ostermann: First, in terms of the top-line results, we had challenging year-over-year comparisons in the period. Shipments of 1.22 million units were down 9%, while revenues of EUR 36 billion were down 14%. At the same time, we were encouraged by initial progress on our commercial recovery efforts. For example, our EU30 market share is edging higher, and the US is seeing improvement in retail order intake. A big contributor is our new product wave. Q1 saw strong launch execution with 3 all-new products kicking off in Europe, along with 3 refreshed products, including the Ram Heavy Duty. Turning to, of course, to the issue of the day with tariffs, we are taking actions to protect the company in the short term, including temporary shutdowns and layoffs, while engaging with relevant governments on the policies themselves.

Doug: In terms of the topline results, we had challenging year over year comparisons in the period shipments of one to 2 million units were down 9%, while revenues of 36 billion euros were down 14% at.

Doug: At the same time, we were encouraged by initial progress on our commercial recovery efforts. For example, our EU 30 market share is edging higher and the U S is seeing improvement in retail order intake.

Doug: A big contributor is our new product wave Q1 saw strong launch execution with three all new products kicking off in Europe, along with three refresh products, including the Ram heavy duty.

Doug: Turning to the of course to the issue of the day with tariffs we are taking actions to protect the company in the short term, including temporary shutdowns and layoffs.

Doug: Engaging with relevant governments on the policies themselves.

Doug Ostermann: Stellantis, of course, appreciates the tariff relief measures decided by President Trump this week, and we're assessing the impact of the updated policy on our North American operations. I'll talk a little bit more about that later in the presentation. Nonetheless, we remain subject to extreme uncertainties. The policy framework on tariffs has shifted since we initially set our 2025 expectations and is continuing to evolve. We're taking what we believe is the appropriate step of temporarily suspending our financial guidance. I'll come back to the tariffs and guidance later in my prepared remarks, but now let's go into more detail on what occurred in Q1 of 2025. First, let's talk about how we're executing on our commercial recovery actions.

Doug: So answer is of course appreciates the tariff relief measures decided by President Trump this week.

Doug: We're assessing the impact of the updated policy on our North American operations I'll talk a little bit more about that later in the presentation. Nonetheless, we remain subject to extreme uncertainties. The policy framework on tariffs has shifted since we initially set our 2025 expectations and is continuing to evolve.

Doug: Evolve and so we're taking what we believe is the appropriate step of temporarily suspending our financial guidance.

Doug: I'll come back to the tariffs and guidance later in my prepared remarks, but now let's go into more detail on what occurred in Q1 of 2025 first let's talk about how we're executing on our commercial recovery actions.

Doug Ostermann: We said last quarter the recovery will be driven in large part by product, with 10 all new products planned in 2025, as well as full year benefits from the many that were launched in 2024. The first three of the all new products, the B-segment Fiat Grande Panda, the Citroën C3 Aircross, and the Opel/Vauxhall Frontera began production in February, filling in product gaps where predecessor products had been out of the market for several quarters. Q1 also saw the launch of the updated Ram 2500 and 3500 medium and heavy duty trucks and the refreshed Opel/Vauxhall Mokka. We said last year we had to improve the timeliness of our new product launches after 2024, which frankly saw too many delays.

Doug: We said last quarter, the recovery will be driven in large part by product with 10, all new products planned in 2025 as well as full year benefits from the many that were launched in 2024.

Doug: The first three of the all new products, the beef segment Fiat Grande Panda, the Citron C III aircrafts and the Opel Vauxhall Frontera began production in February filling in product gaps where predecessor products had been out of the market for several quarters.

Doug: The first quarter also saw the launch of the updated Ram 25, and 3500 medium and heavy duty trucks and the refreshed Opel Vauxhall Moca.

Doug: We said last year, we had to improve the timeliness of our new product launches after 2024, which frankly saw too many delays and I am happy to report that in Q1 execution was very consistent with our latest planning.

Doug Ostermann: I'm happy to report that in Q1, execution was very consistent with our latest planning. Next, let's look at how our new products and other go-to-market improvements are driving our recovery. In Europe, where we've now launched 7 major all new products in the last 6 months, we've begun to see sequential market share improvement. Q1 2025 share of 17.3% was 190 basis points higher than Q4 of 2024, and in fact was the highest quarterly level since Q1 of 2024. European share is improving, particularly in electrified products, as Stellantis climbed to the number one position in hybrids in Q1 and climbed to the number two in BEVs. With Q2 to benefit more fully from the new B-segment products, we have the opportunity to continue our market share momentum in Europe.

Doug: Next let's look at how our new products and other go to market improvements are driving our recovery.

Doug: In Europe.

Doug: Where we've now launched seven major all new products in the last six months, we began to see sequential market share improvement.

Doug: Q1, 2025 share of 17, 3%.

Doug: It was 190 basis points higher than Q4 of 2024 and in fact was the highest quarterly level since Q1 of 2024.

Doug: European share is imprudent, particularly and electrified products has started to climb to the number one position in hybrid in Q1 and climbed to number two in beds with Q2 to benefit more fully from the new <unk> segment products, we have the opportunity to continue our market share momentum in Europe.

Doug Ostermann: Turning to the United States, the commercial recovery is at an earlier stage. After successfully reducing inventories and recalibrating pricing in the second half of 2024, the company is seeing improvement in the retail channel in key nameplates like the Jeep Grand Cherokee and the Compass, and in Ram light and medium duty trucks. We're also seeing strong retail order intake from our dealers. Overall, I'd say we're seeing encouraging progress on the commercial recovery. Now let's turn to the shipment and revenue comparisons. Consolidated shipments fell 118,000 units or 9% year-over-year to 1.22 million. Let's break that down a bit geographically.

Doug: Turning to the United States the commercial recovery is at an earlier stage.

Doug: After successfully reducing inventories and recalibrating pricing in the second half of 2024. The company is seeing improvement in the retail channel and key nameplates like the Jeep Grand Cherokee and the compass.

Doug: And in Ram light and medium duty trucks.

Doug: We're also seeing strong retail order intake from our dealers overall.

Doug: I'd say were seeing encouraging progress on the commercial recovery.

Doug: Okay.

Doug: Now, let's turn to the shipment and revenue comparisons Consol.

Doug: Consolidated shipments fell 118000 units or 9% year over year to $1 2 million.

Doug: And let's break that down a bit geographically.

Doug Ostermann: A little over 80,000 units of the decline was in North America, where shipments fell 20% year-over-year, much more steeply than the sales, due primarily to a later start of production in certain factories in January after extended downtime, and secondarily due to the transition to refreshed and upgraded Ram 2,500 and 3,500 models. The remainder of the shipment decline, almost 40,000 units, was driven by Europe, where shipments declined primarily due to product transition gaps, in particular from the ICE Fiat 500, which remains on hiatus until very late in this year. To a lesser degree, products like the Citroën C3 Aircross and Opel/Vauxhall Frontera, which were reintroduced in mid Q1, but of course, will have a bigger impact on our volumes in Q2.

Doug: A little over 80000 units of the decline was in North America, where shipments fell 20% year over year.

Doug: Much more steeply than the sales.

Doug: Due primarily to a later start of production in certain factories in January after extended downtime and secondarily due to the transition to refreshed and upgraded Ram 2500 3500 models.

Doug: The remainder of the shipment decline almost 40000 units was driven by Europe, where shipment.

Doug: Shipments declined primarily due to product transition gaps and particularly from the ice Fiat 500, which remains on hiatus until very late in this year.

Doug: And to a lesser degree products like the Citroen C. Three aircrafts in Opel Vauxhall criteria, which were reintroduced in mid Q1, but of course, we'll have a bigger impact on our volumes in Q2.

Doug Ostermann: On the next page, let's turn to the revenue bridge to understand the larger 14% revenue decline in more detail. In addition to the 9% decline in vehicle shipments, total mix contributed an additional point of headwind, mostly due to the fact that the North America region, with the company's highest average selling prices, had lower shipment trends than the group as a whole. Next, pricing contributed 3 points of additional headwind, mostly again from North America, which was 6 points lower than Q1 2024 before that region adjusted and recalibrated pricing late last year. Pricing was relatively flat sequentially in Q1 2025 versus where we ended Q4 2024, both at the group level and in North America specifically.

Doug: On the next page.

Doug: Let's turn to the revenue bridge to understand the larger 14% revenue decline in more detail.

Doug: And in addition to the 9% decline in vehicle shipments total mix contributed an additional point of headwind, mostly due to the fact that the North America region.

Doug: The company's highest average selling prices and lower shipment trends than the group as a whole.

Doug: Next pricing contributed three points of additional headwind, mostly again for North America, which was six points lower than the first quarter of 2024.

Doug: For that region.

Doug: Adjusted and Recalibrated pricing late last year.

Doug: Pricing was relatively flat sequentially in Q1, 2025 versus where we ended Q4 2024.

Doug: Both at the group level and in North America, specifically.

Doug Ostermann: Last, a decline in other of EUR -0.4 billion is primarily from the de-consolidation of Comau revenues. Now the next page, let's review our regional segments. In North America, shipments and revenues were lower, primarily due to extended January shutdown that I mentioned previously. This was due to how production ramped following very deliberate inventory reduction in the second half of 2024. It also was negatively impacted by the switchover of the medium and heavy duty Ram trucks. In Enlarged Europe, I mentioned previously the sequential improvement in our market share, which I think was even more notable given the soft industry volume that we had in LCVs, where of course, we have a very strong share.

Doug: And lastly, a decline and other of negative <unk> 4 billion euros is primarily from the <unk> consolidation of come out revenues.

Doug: Now the next page, let's review our regional segments in North America shipments and revenues were lower primarily due to extended January shut down that I mentioned previously this was due to how production ramped following very deliberate inventory reduction in the second half of 2020.

Doug: For it.

Doug: It also was negatively impacted by the switchover of the medium and heavy duty Ram trucks.

Doug: And enlarged Europe.

Doug: I mentioned previously the sequential improvement in our market share, which I think was even more notable given the soft industry volume that we added Ltvs where of course, we have a very strong share we're particularly encouraged by the increase in Bev sales mix as we start the year.

Doug Ostermann: We're particularly encouraged by the increase in BEV sales mix as we start the year on the back of a significant expansion of our electrified offerings across the B and C segments. South America delivered 6% year-over-year revenue growth on 19% higher shipments as the company maintained its number one market position, giving it the biggest benefit from a dramatic recovery in the Argentine market and a more moderate increase in Brazil. Middle East and Africa continue to see negative year-over-year comparisons due to import restrictions in the region, especially in Algeria, but the company has been increasing its local production to mitigate this impact. Turning now to inventories. The business continued managing to the disciplined, healthy levels achieved at the end of 2024, but there was some divergence in the development of company and independent dealer figures.

Doug: On the back of a significant expansion of our electrified offerings across the B and C segments.

Doug: South America delivered 6% year over year revenue growth of 19% higher shipments as the company maintained its number one market position.

Doug: Giving us the biggest benefit from a dramatic recovery in the Argentinian market.

Doug: At a more moderate increase in Brazil.

Doug: Middle East and Africa continue to see negative year over year comparisons due to import restrictions in the region, especially in Algeria, but the company has been increasing its local production to mitigate this impact.

Doug: Turning now to inventories the business continued managing to the disciplined.

Doug: Healthy levels achieved at the end of 2024, but there was some divergence in the development of company and independent dealer figures. Most of this was due to Europe for company inventories bounce back a bit to.

Doug Ostermann: Most of this was due to Europe, where company inventories bounced back a bit to normal levels, I would say, after being well under typical levels at the end of 2024, while dealer inventories declined a bit sequentially. Okay, now that we've covered the top-line dynamics in Q1, let's look at issues affecting Q2 and the broader 2025 period. Let's talk about tariffs. The key things to know about how they impact us in our North American segment. First, let's look at the relevant considerations that frame US exposure. Over the past 5 years, we've invested significantly to maximize compliance within the USMCA context to deliver the most competitive cost possible to our customers. Roughly 3 out of 5 cars we sell in the US are also assembled in the US.

Doug: To normal levels, I would say after being well under typical levels at the end of 2024.

Doug: Well.

Doug: Dealer inventories declined a bit sequentially.

Doug: Okay now that we've covered the topline dynamics in Q1, let's look at issues affecting Q2 and the broader 2025.

Doug: Period.

Doug: So let's talk about tariffs.

Doug: The key things to know about how they impact us in our North American segment.

Doug: First let's look at the relevant considerations that frame U S exposure over the past five years.

Doug: We've invested significantly to maximize compliance within the U S MCA context to deliver the most competitive cost possible to our customers.

Doug: Roughly three out of five cars, we sell in the U S are also assembled in the U S and so on these products tariff exposure is on the imported components, which are overwhelmingly U S. MCA compliant.

Doug Ostermann: On these products, tariff exposure is on imported components, which are overwhelmingly USMCA compliant. Now indicated by the administration to be partially offset by the 3.75% MSRP credit. For the other 2 out of 5 cars that we sell in the US, but are assembled elsewhere, 95% of these in 2024 were USMCA compliant as well, and are subject to very significant US content exclusions when tariffs are calculated. We're also fortunate to have an exceptionally well-balanced geographic footprint. Just to be clear, I wanna point out and emphasize that over the last two years, the company has generated more than half of our operating income outside of North America. Next, let's talk about how we're adapting and responding to protecting the company in the near term in the North America region.

Doug: And now indicated by the administration to be partially offset it offset by the 375% MSRP credit.

Doug: For the other two out of five cars that we sell in the U S. But are assembled elsewhere, 95% of these in 2024, where U S MCA compliant as well and.

Doug: And are subject to very significant U S content exclusions when tariffs were calculated.

Doug: We're also fortunate to have an exceptionally well balanced geographic footprint and just to be clear I want to point out and emphasize that over the last two year years. The company has generated more than half.

Doug: Our operating income outside of North America.

Doug: Next let's talk about how we are adapting and responding to protecting the company in the near term in the North American region.

Doug Ostermann: In Q1, before the tariffs were put in place, the company made public commitments to certain products and facilities in the US. Commitments that we stand by today, making clear our support for both our US workers and administration priorities to strengthen the US manufacturing base. Upon the administration's establishment of new tariffs entering early April, the company launched a new sales campaign extending employee pricing to customers, maximizing engagement with those looking to purchase ahead of tariff impacts. We also reduced or paused shipments of some products subject to higher tariffs, relying on healthy inventories in the short term. As we move forward, we're monitoring market evolution and identifying where we might have some offensive opportunities. For example, where lower tariff US assembled products that we make will face competitors with higher tariff burdens.

Doug: In Q1 before the tariffs were put in place the company made public commitments to certain products and facilities in the U S.

Doug: Commitments that we stand by today.

Doug: Clear our support for both our U S workers.

Doug: And administration priority is to strengthen the U S manufacturing base.

Doug: Upon the administration's establishment of new tariffs entering early April the company launched a new sales campaign, extending employee pricing to customers maximizing engagement with those looking to purchase ahead of tariff impacts.

Doug: We also reduced or pause shipments of some products subject to higher tariffs relying on healthy inventories in the short term.

Doug: As we move forward, we're monitoring market evolution.

Doug: And identifying where we might have some offensive opportunities for.

Doug: For example were lower tariff U S assembled products that we make.

Doug: We will face competitors with higher tariff burdens.

Doug Ostermann: At the same time, we're continuously engaged with US, Canadian, and Mexican governments to make sure they have complete information on how their policies affect our complex industry and millions of our customers. As the situation evolves, we will need to calibrate our North American investments, footprint, and employment to ensure the profitability of our company. Now let's turn to our 2025 guidance, which I said at the start of the presentation was being suspended. While we understand how important the company's views on its financial performance are to your work modeling and valuing the company, the reality is that the baseline foundation of the guidance initiated at the end of February didn't contemplate the current tariff environment.

Doug: At the same time, we're continuously engaged with U S Canadian and Mexican governments.

Doug: To make sure they have complete information on how their policies affect our complex industry and millions of our customers.

Doug: As the situation evolves, we will need to calibrate our north American investments.

Doug: Foot print and employment.

Doug: To ensure the profitability of our company.

Doug: Now, let's turn to our 2025 guidance, which I said at the start of the presentation was being suspended.

Doug: While we understand how important the company's views on its financial performance or to your work modeling in valuing the company. The reality is that the baseline foundation of the guidance initiated at the end of February didn't contemplate the current tariff environment.

Doug Ostermann: With tariff policies evolving continually, the wide range of potential implications for the marketplaces we operate in, and the company's response and mitigation actions still underway, it is not possible at this time to ensure a forecast with adequate accuracy. The company is committed to reinstating financial guidance when we have the ability to do so in a high-quality way. I'd like to now conclude by bringing together again a few main points. First, the Q1 results were lower year-over-year, as we're still in the early stages of our commercial recovery plan, but we are seeing some encouraging signs that we're moving in the right direction. Secondly, we're excited to have great appealing products combined with improved launch execution to begin the 2025 year. We're expanding our market coverage, and this sets us up well to continue improving performance, particularly in Europe.

Doug: With tariff policies evolving continually the wide range of potential implications for the market places we operate in and the company's response and mitigation actions still underway. It is not possible at this time to ensure a forecast with adequate accuracy.

Doug: The company is committed to reinstating financial guidance, when we have the ability to do so in a high quality way.

Doug: Yeah.

Doug: So I'd like to now conclude by bringing together again, a few main points. So.

Doug: So first the Q1 results were lower year over year.

Doug: We're still in the early stages of our commercial recovery plan, but we are seeing some encouraging signs that we're moving in the right direction.

Doug: Secondly, we're excited to have great appealing products combined with improved launch execution to begin the 2025 year.

Doug: We're expanding our market coverage and this sets us up well to continue improving performance, particularly in Europe.

Doug Ostermann: Lastly, with our exceptionally balanced global footprint, the company is well positioned to weather the tariff pressures and is acting with determination to ensure profitability. With that, I'll now ask the operator to open up the call for Q&A.

Doug: Lastly, with our exceptionally balanced global footprint the company is well positioned to weather the tariff pressures and.

Doug: And is acting with determination to ensure profitability.

Doug: And with that I'll now ask the operator to open up the call for.

Operator 1: Thank you, sir. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. If you want to change your mind and withdraw your question, it's star two. Please ensure your lines are unmuted locally as you'll be prompted when to ask your question. Our first question comes from a line of José Asumendi from J.P. Morgan. Please go ahead.

Operator: Thank you, sir. As a reminder, if you would like to ask a question, please press star one on your telephone keypad. If you want to change your mind and withdraw your question, it's star two. Please ensure your lines are unmuted locally as you'll be prompted when to ask your question. Our first question comes from a line of José Asumendi from J.P. Morgan. Please go ahead.

Doug: Q&A.

Speaker Change: Thank you so as a reminder, if you would like to ask a question. Please press star one on your today's from Keypad. If you want to change your mind and withdraw your question. It is star two and fees ensure your lines are on mute locally.

Be prompted went to ask your question. Our first question comes from the line of Joseph <unk> from Jpmorgan. Please go ahead.

José Asumendi: Thank you. Thank you very much, a couple of questions, please. It's José from J.P. Morgan. Doug, you mentioned in your comments some of the optionality you have with regards to the tariffs, and you mentioned calibrating the production footprint. I'm still aware, you know, obviously negotiations going on, but I'd love to hear what are the options that you're considering when it comes to the production footprint or any discussions on the supply front to change that footprint or improve the footprint in the US. The second question would be with regards to pricing.

Speaker Change: Thank you. Thank you very much.

Speaker Change: Couple of questions. Please as.

Doug: Wholesale from JP Morgan Hi, Doug.

Speaker Change: Doug you mentioned in your.

Speaker Change: Your comments some of the Optionality you have with regards to the tariffs you mentioned calibrating the production footprint.

Speaker Change: Im always still obviously negotiations going on but love to hear.

Speaker Change: What are the options that youre, considering when it comes to the promotional footprint.

Speaker Change: Any discussions on the on the supply front, the 10 stocked that footprint to improve our footprint in the U S and the <unk>.

Speaker Change: Second question would be with regards to pricing.

José Asumendi: Should we think that Q1 pricing has been the, let's say, the peak of that negativity we have seen in the revenue bridge for Q1, and Q2 should mark an improvement or is Q2 maybe sort of in line with Q1? Thank you.

Speaker Change: Should we think that the first quarter pricing has been let's say that the fee cost Thats negativity, we have seen in the revenue bridge for the first quarter and Q2 should market improvement or.

Speaker Change: Or is Q2, maybe sort of in line with Q1. Thank you.

Doug Ostermann: Yeah, José, always good to hear from you. Thanks for the questions. First, you know, on changes that we're considering related to the tariffs, of course, we're still kind of absorbing this latest change that came out just in the last kinda day and a half here. The tariff policies are evolving. Frankly, it's a good sign, right? Because we have a regular dialogue with the administration, and they are modeling the tariff policies in ways, particularly the announcements that we heard yesterday, in ways that are very beneficial to our transition. Now, your specific question was about that transition, and really, we've been modeling lots of different scenarios, but there are a number of different actions that we can take.

Speaker Change: Yes.

Speaker Change: Always good to hear from you thanks for the questions.

Speaker Change: So first.

Speaker Change: On changes that we're considering.

Speaker Change: Related to the tariffs and of course, we're still kind of absorbing this latest change that came out just in the last kind of day and a half here.

Speaker Change: And in the tariff.

Speaker Change: Policies are evolving.

Speaker Change: And frankly, it's a good sign right because we have a regular dialogue with the administration.

Speaker Change: And they are modeling the tariff.

Speaker Change: Policies.

Speaker Change: In ways, particularly the announcements that we heard yesterday.

Speaker Change: Ways that are very beneficial too.

Speaker Change: Two our transition now your specific question was about that transition and really we've been modeling lots of different scenarios, but.

Doug Ostermann: One of which I talked a little bit about, which is that we're looking at areas of opportunity where we have US-built vehicles that have very low impact from the tariffs against competitor vehicles that may be imported from places like Korea or Japan, et cetera, where maybe we have an opportunity to take some share. But we're also looking at the tariff exposures that we do have. Obviously, one of the first areas to address will be supply chain. While I, you know, don't wanna gloss over the fact that it does take time to alter supply chains, and I think this latest announcement from the administration is great in a couple ways.

Speaker Change: And there are a number of different actions that we can take one of which I talked a little bit about which is that we're looking at areas of opportunity where we have.

Speaker Change: U S built vehicles that have very low <unk>.

Speaker Change: Packed from the tariffs against competitor vehicles that may be imported from places like Korea, or Japan, et cetera, where maybe we have an opportunity to take some share.

Speaker Change: But we're also looking at the tariff exposures that we do have.

Speaker Change: Obviously, one of the first areas to address will be supply chain and well.

Speaker Change: Don't want to gloss over the fact that it does take time to alter supply chains and I think.

Speaker Change: This latest announcement for them.

Doug Ostermann: One, that it's obviously provides some mitigation to the tariffs, but also that it shows their recognition of the time that it will take for us to make those adjustments. Certainly we're looking at that as a near-term opportunity to work with our suppliers to try and again increase the US content of our vehicles and reduce the tariff impact. There's a whole range of opportunities to mitigate these tariffs that we're looking at. I won't detail all of them today. Of course, those strategies and our implementation of those strategies will very much depend on how the tariffs evolve and the tariff policy evolves over time.

Speaker Change: Administration.

Speaker Change: It is great in a couple of ways one that it's obviously.

Speaker Change: Provide some mitigation to the tariffs, but also that it it shows their recognition of the time that it will take for us to make those adjustments, but certainly we're looking at that as a as a near term opportunity to work with our suppliers to try and again.

Speaker Change: Increased U S content of our vehicles and reduce.

Speaker Change: The tariff impact so.

Speaker Change: There is a whole range of.

Speaker Change: Of opportunities to mitigate these tariffs that we're looking at I won't detail all of them today.

Speaker Change: And of course, those strategies that are implementation of those strategies will very much depend on how the tariffs evolve in the tariff policy evolves over time.

Doug Ostermann: Now, in terms of pricing, of course, you know, I can tell you that in general, not just in automotive, but in general, tariffs, of course, are inherently inflationary, right? We haven't seen much in the way of major price increases yet, but price discipline, I would say right now, has been pretty robust in the US, and we'll have to see, you know, to your specific question on Q2, how that evolves. I think it's very hard to predict, frankly. Right now, I think we're seeing, you know, relative price discipline within the market. Thanks for the question, José.

Speaker Change: Now in terms of pricing.

Speaker Change: Of course.

Speaker Change: I can tell you that.

Speaker Change: In general.

Speaker Change: Not just in automotive, but in general terms.

Speaker Change: <unk> of course are inherently inflationary right.

Speaker Change: We haven't seen.

Speaker Change: Much in the way of major price increases, yet, but price discipline I would say right now.

Speaker Change: <unk> has been pretty robust.

Speaker Change: In the U S and we will have to see to your specific question on Q2, how that evolves I think it's very hard to predict frankly.

Speaker Change: But right now I think we're seeing relative price discipline within the market. So thanks for the question Jose.

José Asumendi: Thank you, Doug.

Doug Ostermann: Yeah.

Operator 1: As we have a high volume of questions raised in the queue, you are kindly asked to limit yourself to one question only, and if necessary, a follow-up question. The next question comes from a line of Thomas Besson from Kepler Cheuvreux. Please go ahead.

Operator: As we have a high volume of questions raised in the queue, you are kindly asked to limit yourself to one question only, and if necessary, a follow-up question. The next question comes from a line of Thomas Besson from Kepler Cheuvreux. Please go ahead.

Jose: Thank you Doug.

Speaker Change: Okay.

Speaker Change: As we have a high volume of questions raised in the Q you are kindly asked to limit yourselves to one question only if necessary a follow up question. The next question comes from the line of Thomas Besson from Kepler.

José Asumendi: Thank you for taking my question. It's Thomas Besson at Kepler Cheuvreux. I'd like to start with product launches and the expected impact for your business, mostly in the US and in Europe. Could you please remind us when each of these key products is expected to have a real impact on volumes? Which quarter in 2025 or 2026 you expect Stellantis share to start rising again? That's my question, and then I have a follow-up, please.

Thomas Besson: Thank you for taking my question. It's Thomas Besson at Kepler Cheuvreux. I'd like to start with product launches and the expected impact for your business, mostly in the US and in Europe. Could you please remind us when each of these key products is expected to have a real impact on volumes? Which quarter in 2025 or 2026 you expect Stellantis share to start rising again? That's my question, and then I have a follow-up, please.

Speaker Change: Please go ahead.

Speaker Change: Thank you.

Speaker Change: Taking my question it's domestic.

Speaker Change: I'd like to start with.

Speaker Change: Launches.

Speaker Change: The expected impact.

Speaker Change: For your business will see the U S and Europe.

Speaker Change: Could you.

Speaker Change: Just remind us when each of these key products.

Speaker Change: As expected to have real impact on volumes.

Speaker Change: Which quarter in 2005 or 2006, you expect share to start rising again.

Doug Ostermann: Sure. You know, as we talked kind of during the last call, a lot of the launches on the European side were late last year and kind of Q1 of this year. When we look at the rollout of the various branded vehicles on the STLA Medium platform, when we look at the sister cars all launching off of the Smart Car platform, a lot of those which started on the Smart Car, for instance, with C3, ë-C3 late last year, have now, you know, rolled out early this year. We look at like C3 Aircross, Fiat Grande Panda, etc., all coming in kind of late February, hitting the market in March.

Speaker Change: My question to the hub.

Speaker Change: Sure sure so.

Speaker Change: As we talked kind of during the last call a lot of the launches on the European side.

Speaker Change: Late last year.

Speaker Change: And kind of first quarter of this year.

Speaker Change: And so when we look at the rollout of the various.

Speaker Change: Branded vehicles on the stellar mid platform.

Speaker Change: When we look at the SR cars, all launching off of the stellar smart card platform.

Speaker Change: A lot of those which started on the smart card for instance, with <unk> EC three late last year.

Speaker Change: Now rolled out early this year when we look at like <unk> three aircrafts, we had grown dependent etcetera, all coming in kind of late February hitting the market in March so the real impact of those.

Doug Ostermann: The real impact of those should ramp up in Q2 more so than Q1. As I outlined kind of in my commentary, we've already seen. To answer your question directly, we are already seeing market share improvement in Europe, right? We're up 190 basis points sequentially already. You know, we've made great strides on our BEV mix. I think, you know, we're seeing very positive signs. As I mentioned, the majority of that impact or a lot of that impact, you know, will really ramp up in Q2. I think there's more momentum to come there. When we look at North America, of course, you know, as I mentioned, we have taken some production out at plants, particularly in Canada and Mexico, some of which was mostly tariff related.

Speaker Change: Good ramp up in Q2, more so than in Q1, but as I outlined kind of in my commentary we've already seen to answer your question directly we are already seeing market share improvement.

Speaker Change: In Europe were up 190.

Speaker Change: Basis points sequentially already.

Speaker Change: We've made great strides on our.

Speaker Change: Our Bev mix.

Speaker Change: And so I think we're seeing very positive signs, but as I mentioned the.

Speaker Change: The majority of that impact or a lot of that impact will really ramp up in Q2. So I think there is there is more momentum to come there when we look at North America.

Speaker Change: Of course.

Speaker Change: As I mentioned, we have taken some production out at plants, particularly in Canada, and Mexico, some of which was mostly tariff related.

Doug Ostermann: When we look at introductions, the 2500, 3500 medium- and heavy-duty trucks are just coming into the market kind of in the last say 4 to 5 weeks. It's still pretty early there. The other I would say significant launches that we think about later in the year for us in particular will be the Jeep Cherokee replacement, which I'd mentioned was kind of late Q3 early Q4. We have of course the Ram 1500 Ramcharger, Jeep Recon, various versions of the Dodge Charger in terms of four-door and the ICE vehicles scattered throughout the year. It's more back-loaded in North America for sure. I would expect to see those market share gains overall be later in the year.

Speaker Change: When we look at introductions that 2500, 3500 medium and heavy duty trucks are just coming into the market.

Speaker Change: Kind of in the last say four to five weeks in so it's still pretty early there.

Speaker Change: I would say significant launches that we think about later in the year for us.

Speaker Change: In particular, we will be the Cherokee replacement, which I had mentioned was kind of late third quarter early fourth quarter and then we have of course the.

Ram Charger recon various versions of the of the charger in terms of afford or and the ice vehicles scattered throughout the year. So it's more back loaded in North America for sure. So I would expect to see those market share gains.

Doug Ostermann: Although I think in North America, it's important to distinguish between retail share and fleet share. We right now are very focused on improving our retail share in North America. Fleet right now is not particularly profitable, and I would say is a much lower priority for the team in North America at this point. We'll see some development there. Latin America, you know, still number one, growing the volumes, and even though from a revenue standpoint, we have some FX headwinds, I think we are very well-positioned in Latin America. I think those are the three keys that I would outline.

Speaker Change: Overall be later in the year although.

Speaker Change: I think in North America, it's important to distinguish between.

Speaker Change: Retail share and fleet sure. We right now are very very focused on improving our retail share in North America fleet right now is not particularly profitable and I would say is a much lower priority for the team in North America at this point, so we'll see some development there.

Speaker Change: Latin America still.

Speaker Change: Still number one.

Speaker Change: Growing the volumes.

Speaker Change: And even though from a revenue standpoint, we have some FX headwinds I think we still are very well positioned in Latin America. So I think those are the three <unk> that I would outline the other market I think that's very important to think about is middle East Africa, where as I mentioned year over year comparisons are pretty tough.

Doug Ostermann: The other market I think that's very important to think about is Middle East, Africa, where, as I mentioned, year-over-year comparisons are pretty tough, given some of the import restrictions. We're gonna need to continue to work on our localization to bring those year-over-year comparables back into alignment and be able to service our customers. We have a very strong story there. Hopefully that covers it, Thomas. Thank you.

Speaker Change: Given some of the import restrictions, we're going to need to continue to work on our localization to bring those year over year comparable back into into alignment and be able to service our customers.

Speaker Change: We have a very strong story, there so hopefully that.

Thomas Besson: Yeah. Thank you very much. I'd like, if possible, to use a follow-up to come back on the José Asumendi question about calibrating your footprint. Is there any easy wins for you with limited investments that would allow you-

Speaker Change: Hovers at Thomas Thank you, yes, thank you very much.

Speaker Change: Possible to use a follow up to come back on the first.

Laborde: Question Laborde.

Speaker Change: Reaching your footprint.

Laborde: Is there.

Laborde: You win for you.

Doug Ostermann: Yeah.

Thomas Besson: -to better use your US manufacturing footprint either within-

Doug Ostermann: Yeah.

Thomas Besson: -to better use your US manufacturing footprint either within-

Laborde: Limited investments.

Laborde: Sure.

Laborde: Better use.

Doug Ostermann: Yeah.

Thomas Besson: the USMCA or globally that you can talk about, notably, on the truck front?

Laborde: Manufacturing footprint.

Laborde: Either within the U S MCA or globally that you can talk about.

Doug Ostermann: Yeah, no, it's an excellent question. It's something that we're working very hard on, right? To think through how quickly we can make those changes to mitigate any tariff impacts. Of course, the $3.75 benefit on MSRP of US-produced vehicles is helpful, but for a transitional period, right? We are working, of course, to shift some production where we're dual sourced, right? We have full-size truck production in Mexico, but also in Michigan to shift some production to the extent that we can. We, of course, are looking at opportunities with suppliers to increase the content in the short term.

Laborde: On the truck fleet.

Laborde: Yes.

One question and it's something that we're working very hard on rate.

Laborde: Through.

Laborde: How quickly can we can we make those changes to mitigate any tariff impacts of course, the three $3 75.

Laborde: Benefit an MSRP of U S produced vehicles is helpful, but for a transition period right. So we are.

Laborde: Working of course.

Laborde: To shift some production, where we're dual sourced right. So we have full.

Laborde: A full size truck production in Mexico, but also in Michigan.

Laborde: To shift some production to the extent that we can.

Laborde: We of course are looking at opportunities with suppliers to increase the content in the short term.

Doug Ostermann: What are those parts that we're sourcing from areas in particular, high tariff countries outside of Canada and Mexico that are not USMCA compliant, non-USMCA compliant parts that are sourced from Canada and Mexico? There's a lot of opportunities, and we're hard at work to take advantage of them. Each of them, of course, has a, you know, very different timeline. We'll of course have to modulate those as the policy itself evolves. Those are some of the things that we're thinking about, so hopefully that's helpful.

Speaker Change: What are those.

Speaker Change: Parts that were sourcing from areas in particular high tariff countries outside of Canada, and Mexico that are not U S. MCA compliant parts non U S. MCA compliant parts that are sourced from Canada, and Mexico, So theres a lot of opportunities.

Speaker Change: And we're hard at work to take advantage of them and each of them of course has a.

Speaker Change: Very different different timeline.

Speaker Change: And we will of course have to modulate those as the as the policy itself.

Thomas Besson: Yep. Thank you very much.

Speaker Change: <unk>, but but those are some of the things that we're thinking about so hopefully that's helpful.

Operator 2: The next question comes from a line of Philippe Houchois from Jefferies. Please go ahead.

Operator: The next question comes from a line of Philippe Houchois from Jefferies. Please go ahead.

Speaker Change: Yes, thank you very much.

Speaker Change: Okay.

Philip: The next question comes from the line of Philip <unk> from Jefferies. Please go ahead.

Philippe Houchois: Can you hear me better now? My question was on light commercial vehicles. We've seen quite a bit of weakness in Europe in general, this big profit generator for Stellantis. Could you comment on how you're performing in that segment, and what is driving the weakness in the market? Thank you.

Philip <unk>: Can you maybe I don't know my question was unlike commercial vehicles, we've seen quite a bit of weakness in Europe. In general is a big profit generator forced Atlantis could you comment on how you're performing in that segment.

Doug Ostermann: Yeah, Philippe, it's a great question. You're right. I mean, the light commercial vehicle segment as a whole is not doing that well right now in Europe. We're seeing, I think a lot of companies that are concerned about the economy, their economic performance. There's a lot of macro uncertainty right now, and when that happens, a lot of companies extend the life of their vehicles rather than investing and upgrading. That's a challenge for us because we are the number one player there. We're very strong. It's an important profitable segment for us, and we're doing very well.

Philip <unk>: What is driving the weakness in the market. Thank you.

Philip <unk>: Yes, it's a great question Youre right I mean.

Philip <unk>: The light commercial vehicle segment as a whole.

Philip <unk>: Is not doing that well right now.

Ian: Ian in.

Philip <unk>: In Europe.

Philip <unk>: We're seeing I think a lot of companies that are concerned about.

Philip <unk>: The economy there are economic.

Philip <unk>: Performance, there's a lot of macro uncertainty right now and when that happens a lot of companies extend the.

Philip <unk>: The life of their vehicles, rather than investing and upgrading.

And so that's a challenge for us because we are the number one player. There were very strong. It is an important profitable segment for us and we're doing very well, but those are those are long standing relationships that we've had with a lot of those customers. So we're trying to help them work through those issues.

Doug Ostermann: You know, those are long-standing relationships that we've had with a lot of those customers, so we're trying to help them, you know, work through those issues, and trying to do things, you know, on the financial side to help support their investment. Right now, that macro uncertainty, I think, is holding back the segment as a whole. Our share there is still very strong.

Philip <unk>: And trying.

Philip <unk>: Trying to do things on the financial side to help support their investment, but but right now that macro uncertainty I think is holding back the segment as a whole, but our share there is still very strong and if I can use that follow up still on that topic of Ltvs is.

Philippe Houchois: If I can use that follow-up still on that topic of LCVs, we know the EU is easing the compliance period for CO2, but even with that, it seems quite unworkable for the light commercial vehicle segment. Any visibility of changing the rules or, you know, how can basically the rules be changed that you just don't have a timing problem on LCV compliance? Or, would I read you to take a provision in 2025 specifically?

Philip <unk>: We know the EU is easing in the compliance periods with Q2, but even without it seems quite on the workable for the light commercial vehicle segment.

Philip <unk>: Any any visibility of changing the rules or basically will be changed that you just don't have a timing problem on the LTV compliance.

Doug Ostermann: No, I mean, I think that there are, you know, we have an ongoing dialogue in Europe around that topic because you're right. It's very challenging given the demand for these powertrains, you know, BEV powertrains. You may have noticed that we've introduced just recently an upgraded line of BEV and hybrid powertrains on our LCVs in Europe, so we are working towards it. It is very challenging from a regulatory standpoint and the demands that are out there. We do have a few strategies from a product standpoint. I can't really talk about those today. We're not gonna be making any announcements today. We're trying to address it from both fronts.

Philip <unk>: Or would that lead you to take a provision in 2025 specifically.

Philip <unk>: No.

Philip <unk>: I think that there there are.

Philip <unk>: We have an ongoing dialogue.

Philip <unk>: In Europe.

Philip <unk>: Around that topic, because youre right.

Philip <unk>: Very very challenging given the demand for.

Philip <unk>: These powertrains.

Philip <unk>: Deb powertrains.

Philip <unk>: Notice we've introduced just recently.

Philip <unk>: And upgraded line of Bev and hybrid powertrains honor Ltvs in Europe. So we are working towards it.

Philip <unk>: But it is very challenging from a regulatory standpoint, and the demands that are out there.

Philip <unk>: But we do have a few strategies.

Philip <unk>: Product standpoint, I can't really talk about those today, we're not going to be making an announcement today, but we're trying to address it from both fronts one.

Doug Ostermann: One, in terms of making sure that the regulators understand the situation and perhaps there are some adjustments that can be made there as we've seen, you know, on the passenger car side. Also working on the product side and hopefully we can give more clarification on that front, down the road here later this year.

In terms of making sure that the regulators understand the situation.

Philip <unk>: And perhaps there are some adjustments that can be made there as we've seen on the passenger car side.

Philip <unk>: But also working on the product side and hopefully we can we can give more clarification on that front down the road here later this year.

Philippe Houchois: Thank you very much.

Doug Ostermann: Mm-hmm.

Operator 2: The next question comes from a line of Horst Schneider from Bank of America. Please go ahead.

Operator: The next question comes from a line of Horst Schneider from Bank of America. Please go ahead.

Philip <unk>: Thank you very much.

Philip <unk>: Okay.

Horst Schneider: Our next question comes from the line of Horst Schneider from Bank of America. Please go ahead.

Horst Schneider: Yes, good morning, and thanks for taking also my question. I want to dig into some more detail on Europe. You were quite optimistic in your tone on development of the European business. Maybe you can help us a little bit on the output for the region. Can we still expect that H2 volume is gonna be higher than H1? Can you also make some comment on the pricing? You made the statement on pricing that North America, I think, was -6% versus global -3%. What was the impact in Europe? Then in total, the question would be still margin H2 Europe can be stronger than H1?

Horst Schneider: Yes, good morning, and thanks for taking my question.

Horst Schneider: I want to dig into some more detail on Europe.

Horst Schneider: You were quite optimistic in your tone on development of the European business.

Horst Schneider: So maybe you can help us a little bit on the outlook for the region.

Horst Schneider: So can we still expect that <unk> volume is going to be higher the next one.

Horst Schneider: Can you also make some comment on the pricing you made the statement on pricing.

Horst Schneider: North America was minus 6% business global minus three.

Horst Schneider: What was the impact in Europe and then in total then the question will be margin H <unk> Europe can be stronger than each one.

Doug Ostermann: Yeah, look, you know, clearly we knew that that pricing first half in North America was gonna be a tough comparison period, right? Because we took about 4% of pricing adjustments second half last year and even maintaining kind of the same pricing, right? We knew the year-over-year comparison was gonna be tough in North America. Europe is a different situation. We took a lot of the price adjustment during the first half, so the year-over-year comparison is a little bit more favorable.

Horst Schneider: Okay.

Horst Schneider: Currently we knew that.

Horst Schneider: That pricing first half in North America.

Horst Schneider: Was going to be a tough comparison period right because we took about 4% of pricing adjustments second half.

Horst Schneider: Last year.

Horst Schneider: And even maintaining kind of the same pricing right. We do the year over year comparison was going to be tough in North America.

Horst Schneider: Europe is in a different situation, we took a lot of the price adjustment during the first half.

Doug Ostermann: We took about 2% last year. We're down about 2%, sorry, in Q1 this year, in terms of pricing, but it's certainly not as bad a comparison as what we look at, you know, year-over-year in North America, which I kinda tried to foreshadow to you guys a few times in the previous calls. When we look at Europe, I think, you know, predicting forward pricing is always very challenging, so I'm a little reluctant to do so. I don't see, you know, significant price deterioration.

Horst Schneider: So the year over year comparison is a little bit more favorable we took about 2% last year.

Horst Schneider: We're down about 2% sorry in Q1 this year.

Horst Schneider: Terms of pricing, but it's certainly not as bad a comparison is what we look at it.

Horst Schneider: The year over year in North America, which which.

Horst Schneider: Tried to foreshadow too you guys a few times in the previous calls, but when we look at Europe.

Horst Schneider: I think.

Horst Schneider: Any forward pricing is always very challenging so im a little reluctant to do so but I don't see.

Doug Ostermann: Really, you know, from my perspective, the biggest threat to serious price deterioration or price discipline or lack of discipline in Europe was that, you know, under the regulatory regime where everybody had to hit these kind of more stringent requirements by the end of the year. I was very concerned that many competitors with, I would say, a less prepared product portfolio, seeing their BEV mix towards the end of the year might panic, look at the fines that they might be subject to, and that pricing discipline would really fall apart late in the year.

Horst Schneider: Significant price deterioration and really.

Speaker Change: From my perspective, the biggest threat.

Horst Schneider: Two serious price did depreciate.

Horst Schneider: Price.

Horst Schneider: Discipline or lack of discipline.

Horst Schneider: In Europe.

Horst Schneider: Was that.

Horst Schneider: Under the <unk>.

Horst Schneider: The regulatory regime, where everybody had to hit these kind of more stringent requirements by the end of the year I was very concerned that many competitors with.

Horst Schneider: I would say are less prepared product portfolio.

Seeing.

Horst Schneider: Theyre Bev mixed towards the end of the year might panic look at the fine that they might be subject to and that pricing discipline would really fall apart late in the year with this new kind of three year compliance scheme. That's been introduced in Europe, I think we have largely.

Doug Ostermann: With this new kind of three-year compliance scheme that's been introduced in Europe, I think we have largely averted the possibility of that happening late in the year, which I think is very good for the industry as a whole. That being said, you know, we're making nice gains, as I mentioned in my commentary, on that front, with our new B-segment and C-segment vehicles, which have very I think competitively priced and well engineered from a range and performance perspective. The customers are responding very positively. We're seeing BEV mix, you know, that's been increasing. I think we'll see more of that as these vehicles really hit their stride Q2, Q3. Thanks for the question.

Horst Schneider: The possibility of that.

Horst Schneider: Happening late in the year, which I think is very good for the industry as a whole.

Horst Schneider: That being said we're making.

Horst Schneider: Nice gains as I mentioned in my commentary.

Horst Schneider: On that front.

Horst Schneider: With our new B and C segment vehicles, which have a very.

Horst Schneider: I think competitively priced and well engineered from a range and performance perspective.

Horst Schneider: And the customer is responding very positively so we're seeing that mix.

Horst Schneider: That's been increasing and I think we'll see more of that as these vehicles really hit their stride Q2 Q3.

Horst Schneider: Thank you.

Operator 2: Our next question comes from a line of Daniel Roeska from Bernstein Research. Please go ahead.

Operator: Our next question comes from a line of Daniel Roeska from Bernstein Research. Please go ahead.

Horst Schneider: Thanks for the question.

Horst Schneider: Thank you.

Speaker Change: Our next question comes from Manav, Daniel <unk> from Bernstein Research. Please go ahead.

Daniel Roeska: Hey, good morning, and thanks for taking my question. It's Daniel from Bernstein.

Doug Ostermann: Hi, Daniel.

Daniel Roeska: Dan, thanks very much for the color. Could I dive into kind of two details you alluded to? One, on the parts you're using in your US-manufactured vehicles, you said the overwhelming majority of those parts were either US-based or USMCA compliant. Could I push you to kind of give us a range what that non-USMCA compliant parts content is? Is that kind of 30, 20, 10, 5 percent? Really just broad ranges. Also with the questions of some of my fellow analysts, what is your kind of view over the next two, three years? How much of that can you shift into a USMCA compliance situation? Thanks.

Daniel: Hey, good morning, and thanks for taking my question, it's Daniel from Bernstein.

Daniel: Doug Thanks, very much for the color.

Daniel: Could you dive into kind of two two details you alluded to one on the parts youre using in your U S manufactured vehicles.

Daniel: Said the overwhelming.

Daniel: Majority of those parts were either U S based or U S. MCA compliance could I push you to kind of give us a range what that non U S. MCA compliant heart's content is is that kind of 30 2010, 5%.

Daniel: Just broad ranges and.

Daniel: Also with the questions.

Speaker Change: Hello analysts what is your kind of view over the next two to three years, how much of that can you shift into a U S MCA compliance.

Doug Ostermann: Yeah. When we look at our US-manufactured vehicles, the USMCA compliant parts within those vehicles are roughly 80%. Now, it varies a little bit, you know, by vehicle, of course, and by trim mix and all that kind of good stuff. As a ballpark number, I think that's a pretty good estimate. Of course, the 20% that is non-USMCA compliant is the piece that is subject to tariffs.

Daniel: Situation. Thanks.

Daniel: Yes, so so when we look at our U S manufactured vehicles.

The U S MCA compliant.

Daniel: Parts within those vehicles are roughly 80% it varies a little bit by by vehicle of course.

Daniel: By trim mix and all that kind of good stuff, but as a ballpark number I think thats a pretty good estimate.

Daniel: And of course, the 20% that is non U S. MCA compliant is the piece that is subject to tariffs.

Doug Ostermann: Now, what I think is really interesting about, of course, this announcement that we just got from President Trump is that, you know, they've tried to look at that, and they said, Look, you know, if you can get to 15%, and that's, you know, subject to, let's say, a tariff of around 25% with, let's say, lots of that coming from places like Mexico and Canada that are at the 25% tariff level, essentially the 3.75%, 15 times the 25%, right? The 3.75% of MSRP should cover your tariff exposure for this first year. I think, you know, we're seeing the administration through this dialogue, one, I think try to mitigate some of the impacts, right?

Daniel: Now what I think is really interesting about of course this announcement that we just got from.

Daniel: President Trump is is that they have.

Daniel: Tried to look at that and they said look if you can get to 15%.

Daniel: And Thats.

Daniel: Subject to let's say tariff of around 25% with let's say lots of that coming from places like Mexico, and Canada that are at the 25% tariff level essentially the 375% 15 times, the 25% rate the 353, 75% of MSRP should cover.

Daniel: <unk> your tariff exposure for this first year.

Daniel: And so I think we're seeing the administration through this dialogue.

Doug Ostermann: Because I think they recognize that they don't wanna hurt the profitability of the industry at a time when we are trying to make this transition. At the same time, you know, recognizing that these supply chains that we've invested in over the last 5 years will take a little bit of time to adjust. Clearly, they're thinking things through. Now, is it a perfect offset? Well, as I just mentioned, not all of our vehicles are at the 85% level. Of course, not all of that non-content is at the 25% tariff level, right? We need to work on it. We're very active in working on that.

Daniel: One.

I think tried to.

Daniel: Mitigate some of the impacts right because I think they recognize that they don't want to hurt the profitability.

Daniel: Of the industry at a time when we are trying to make this transition.

Daniel: And at the same time.

Daniel: Recognizing that these supply chains that we've invested in over the last five years, we will take a little bit of time to to adjust.

Daniel: But clearly theyre thinking things through now.

Daniel: Is it a perfect offset well as I just mentioned not all of our vehicles are at the 85% level.

Daniel: And of course, not all of that non content is at the 25% tariff level right and so so.

Doug Ostermann: Some suppliers who may have excess capacity in the United States may be able to switch relatively quickly. Other suppliers, it'll be, you know, take much longer, right? There's a whole range there of timelines. I think, you know, we have some clear strategies that can improve the situation. Hopefully that answers your question, Daniel. Thank you.

Daniel: So we need to work on it.

Daniel: And we're very very active in working on that.

Daniel: And some suppliers.

Daniel: Who may have excess capacity in the United States may be able to switch relative.

Daniel: Relatively quickly.

Daniel: And other suppliers it'll be take much longer right.

Daniel: So there's a whole range there of timelines, but I think we we have some clear strategies that can improve situation. So hopefully that answers your question Danielle. Thank you.

Daniel Roeska: No, very, very helpful. I mean, the other part of this is the cars you import from Mexico and Canada, which are USMCA compliant. What's the US content share kind of in the cars that are USMCA compliant and being imported into the US?

Daniel: Very helpful and the.

Daniel: The other part of this is the core do you import from Mexico, and Canada, which are <unk> compliant.

Daniel: The U S potentially are kind of in the cars that are U S. MCA comply to being imported into the U S.

Doug Ostermann: Yeah, I mean, we, you know, as you correctly outlined, it's really the US content that matters for those vehicles. We have publicly stated already that the range is 30 to 50%. You know, it varies by vehicle. Again, that's an opportunity for us, where, you know, potentially we can increase that US content by working with our supply base and try to, you know, mitigate some of the impact in the near term. Certainly, it's a very different calculation, you know, very different type of setup than the cars assembled in the US.

Daniel: Yes.

Speaker Change: As you as you correctly outlined it's really the U S content that matters for those vehicles. We have publicly stated already that the range is 30% to 50%.

Daniel: It varies by by vehicle.

Speaker Change: But again, that's an opportunity for us.

Speaker Change: Where potentially we can we can increase that that U S content.

Speaker Change: By working with our supply base and try to.

Speaker Change: Mitigate some of the impact.

Speaker Change: In the near term, but certainly it's a very different calculation very different type of setup.

Daniel Roeska: Perfect. Thanks, Doug.

Doug Ostermann: Mm-hmm.

Speaker Change: Then the cars assembled in the U S.

Operator 2: The next question comes from a line of Tom Narayan from RBC. Please go ahead.

Operator: The next question comes from a line of Tom Narayan from RBC. Please go ahead.

Doug Thanks: Perfect. Thanks, Doug.

Speaker Change: Okay.

Speaker Change: Our next question comes from the line of Tom Narayan from RBC. Please go ahead.

Tom Narayan: Thanks for taking the question. Hi, Doug. Tom Narayan, RBC. Kind of a follow-up to the last one. Thanks for breaking out that 3.75 math. I think that's something a lot of us have been kind of poring over, a lot of confusion there. It seems like it's on the MSRP. Not to sound cheeky here, but just curious if that actually gives some wiggle room to potentially, you know, have a higher MSRP, maybe increase the incentive and maybe have a greater offset potentially to get to the compliance in the first year of the USMCA compliant components. Is that something you envision? I have a follow-up.

Tom Narayan: Thanks for taking my question Hi, Doug.

Speaker Change: <unk> RBC.

Speaker Change: Kind of a follow up to the last one and thanks for breaking out that $3 75 math.

Speaker Change: It's something a lot of discipline.

Speaker Change: Pouring over a lot of confusion there.

Speaker Change: It seems like it's on the MSR E not to sound cheeky here, but just curious if that actually give some wiggle room.

Speaker Change: <unk> has a higher MSRP, maybe increase the incentive and maybe have a greater offset potentially to get to the compliance and the first year of the.

The U S MCA compliant.

Doug Ostermann: Yeah, I mean, that's not a strategy that we're focused on pursuing because of course, that would be a fairly short-term benefit. Look, I think the administration in that regard has been a bit generous by basing it on MSRP rather than cost of the vehicle. That's helpful. It recognizes also that a lot of us are not fully at the 85%. It recognizes that some of the content, you know, parts coming from China, for example, may be at a higher rate than the 25% that was used in their calculation. I think they've provided us a bit of flexibility there, which of course we appreciate. Fundamentally, you know, it's gonna benefit us over time to work with our supply base.

Speaker Change: Components is that something you envision and level.

Speaker Change: Yes, I mean, that's not a <unk>.

Speaker Change: Strategy that that we're focused on pursuing because of course that would be a fairly short term.

Speaker Change: Benefit but.

Speaker Change: Look I think the administration in that regard has been a bit generous by basing it on MSRP rather than cost of the vehicle that is helpful.

Speaker Change: Recognize also that a lot of us are not fully up to 85% it recognizes that some of the content.

Speaker Change: Parts coming from China for example, maybe at a higher rate than the 25% that was used in their calculation I think they've provided us a bit of flexibility there which of course, we appreciate.

Doug Ostermann: Frankly, just as we did five years ago when USMCA came in, right? We optimized and adjusted, and we're gonna need to do some of that now as well. You know, in reality, this shift in policy is so significant for the industry that as I mentioned in my commentary, we're gonna have to take a very hard look once we get some stability and really understand all the details, at exactly, you know, what moves we are gonna make, you know, from a footprint standpoint, from an employment standpoint, and from a capital investment standpoint. You know, it's a time where that kind of scenario planning and thinking through all those strategy is very important. Thanks for the question.

Fundamentally.

Speaker Change: Yeah.

Speaker Change: It's going to benefit us over time.

Speaker Change: To work with our supply base and frankly, just as we did five years ago. When U S. MCA came in right, we optimize and adjusted.

Speaker Change: And.

Speaker Change: We're going to need to do some of that now as well.

Speaker Change: But in.

Speaker Change: In reality this shift in policy is so significant for the industry that as I mentioned in my commentary, we're going to have to take a very hard look once we get some stability and really understand all the details.

Speaker Change: Exactly what moves we are going to make.

Speaker Change: From a footprint standpoint from an employment standpoint.

Speaker Change: And from a capital investment standpoint.

Speaker Change: So.

Speaker Change: It's a time where.

Tom Narayan: Just a quick.

Speaker Change: That kind of scenario planning and thinking through all of those strategy is very important.

Doug Ostermann: Yeah.

Tom Narayan: Great. A quick follow-up. I get the near-term gyrations, headwinds across the industry, but is there an argument to be made that longer-term, maybe 2, 3, 4 years from now, this whole could advantage Stellantis, right? You have the US footprint after you've done a lot of these changes, potentially it advantages you guys over some of the foreign importers into the US. Is that a right way to look at it? I mean, certainly some folks are looking at what if there's a new administration in 4 years. I mean, do you look at it as actually this is great for us long-term, or is that kinda creep into your mind in terms of how you determine what to do? Thanks.

Speaker Change: Thanks for the question, it's a quick yes.

Speaker Change: Okay, Great and a quick follow up.

Speaker Change: So I get the near term gyrations headwinds across the industry, but is there an argument to be made that longer term, maybe 234 years from now.

Speaker Change: This whole COVID-19 advantage to Lantus right you have the U S footprint after you've done a lot of these changes potentially in advantages you guys offer some of the foreign <unk>.

Speaker Change: <unk> into the U S is that a right way to look at it I mean, certainly some folks are looking at what if there is a new administration in four years I mean is that when you look at it is actually this is great for us long term or is that kind of creep into your mind in terms of how you determine what to do.

Doug Ostermann: Yeah, I mean, it's a great question. I think time will tell. Certainly we believe strongly that the intent of the administration is to strengthen the new US manufacturing base. We are a big part of the US manufacturing base, and we certainly consider ourselves the home team. To the extent that the Trump administration is focused on supporting US manufacturing and in particular supporting, as I think about it, as the home team, which is us, long term, I'm certainly hopeful that it will turn out the way that you've articulated, right? That I think is part of the intent here. That's my own view, but I think it is a possibility down the road.

Speaker Change: Yes.

Speaker Change: It's a great question.

Speaker Change: And really I think time will tell.

Speaker Change: Certainly.

Speaker Change: We believe strongly that the intent of the administration is to strengthen the new U S manufacturing base.

Speaker Change: And we are a big part of the U S manufacturing base.

Speaker Change: And we certainly consider ourselves the home team.

Speaker Change: And so to the extent that the.

Speaker Change: The Trump administration is focused on.

Speaker Change: On supporting U S manufacturing and in particular <unk>.

Speaker Change: <unk>.

Speaker Change: As I think about it is the home team which is us.

Speaker Change: Long term I'm, certainly hopeful that it will turn out the way that you've articulated right.

Speaker Change: That I think.

Speaker Change: As part of the intent here.

Doug Ostermann: In the near term, of course, it's very disruptive and has created a lot of uncertainty. That's what we're kinda working through in the near term, right?

Speaker Change: And that's.

Speaker Change: That's my own view, but but I think it is a possibility down the road, but in the near term of course, it's very disruptive and has created a lot of uncertainty.

Tom Narayan: Yeah. Got it. Thank you.

Doug Ostermann: Okay.

Speaker Change: And that's what we're kind of working through in the near term right.

Speaker Change: Got it thank you.

Operator 2: The next question comes from a line of Patrick Hummel from UBS. Please go ahead.

Operator: The next question comes from a line of Patrick Hummel from UBS. Please go ahead.

Speaker Change: Okay.

Patrick Hummel: Thank you. Hi, Doug. One question from me as far as the cash generation of the business or the cash burn is concerned. You already said that in the first half, one should not really expect a positive free cash flow. Now we know the North American working capital is quite sensitive to swings in production, et cetera. You know, given it's already end of April, do you have any visibility what we should be prepared for the end of first half? Like what you know could a free cash flow scenario look like? Are we still talking you know small negative, or could this be a sizable negative as it was in the entire year, 2024? Just to get a rough feeling for what to expect. Thank you.

Speaker Change: Our next question comes from the line of Patrick Hummel from UBS. Please go ahead.

Speaker Change: Thank you and hi, Doug.

Speaker Change: One question for me as far as the cash generation of the business, where the cash burn is concerned.

Speaker Change: You already said that in the first half one should not really expect a positive free cash flow.

Speaker Change: Now we know the North American.

Working capital is quite sensitive to swings in production et cetera.

Speaker Change: Given it's already end of April do you have any visibility what we should be prepared for for the end of first half like what.

Speaker Change: Could a free cash flow scenario look like are we still talking small negative or could this be a sizeable negative as it was in the entire year of 2024, just to get a rough feeling for what to expect.

Doug Ostermann: Yeah. Patrick, you know, of course, as I mentioned, we've decided to remove guidance, so I don't wanna try and give you guidance in a very uncertain environment. I will remind you that when it comes to our industrial free cash flow, a lot of it, as opposed to looking at the overall production levels during the half, will depend on our production levels really in the last kinda six to eight weeks of the half, right? Keep in mind that we did take some production downtime in early January, which helped to improve our order bank. We have a healthy amount of orders, as I've mentioned in my commentary coming in now.

Patrick: Yes, Patrick.

Patrick: Of course, as I mentioned, we've decided to remove guidance. So I don't want to try and give you guidance in a very uncertain environment, but I will remind you that when it comes to our industrial free cash flow a lot of it.

Patrick: As opposed to looking at the overall production levels during the half will depend on our production levels really in the last kind of six to eight weeks of the half right. So.

Patrick: Keep in mind that we did take some production downtime in early January.

Doug Ostermann: If we can run our plants in a healthy way, in the last kinda 6 to 8 weeks of the half, you know, that certainly will help cash flow. Beyond that, I really am not in a position to provide you much guidance there.

Patrick: Which helped to improve our order bank, we have a healthy amount of orders as I mentioned in my commentary coming in now so we can run our plants in a healthy way in the last kind of six to eight.

Patrick: Weeks of the half.

Patrick: Yes.

That certainly will help cash flow, but beyond that I really really.

Patrick Hummel: Okay. If I can just follow up on that, Doug. As far as the investment side of things is concerned, would you know, see any significant variance in what you're gonna spend this year, depending on what happens on the tariff front? Or would you say, you know, the quick fixes that you might be doing to boost US production will not have any major impact on your CapEx spend this year?

Patrick: Not in a position to provide you much guidance there.

Speaker Change: Okay, and if I can just follow up on that back as far as the investment side of things is concerned where do you.

Patrick: See any any significant.

Patrick: <unk> and what Youre going to spend this year, depending on what happens on the tariff front or would you say.

Patrick: The quick fixes that you might be doing to boost U S production will not have any major impact on your on your Capex spend this year.

Doug Ostermann: Yeah. I think given the uncertainty, you're not gonna see a lot of, you know, CapEx decisions from us here related to tariff exposure in the first half. I would guess you won't see a lot of that across the industry. I think most of us are kind of in this period of waiting for a bit more clarity. Now, as I mentioned during our previous call, we do expect CapEx spending to moderate a little bit this year as we get through some of these launches that we talked about, right? The Smart Car and Stellantis industrializations in Europe were happening kind of second half last year heavily.

Patrick: Yes, I think given the uncertainty youre not going to see a lot of.

Patrick: Capex decisions from us here related to tariff exposure in the first half.

Patrick: And I would guess you wont see a lot of that across the industry I think most of us are kind of.

Patrick: In this period of waiting for a bit more clarity.

Patrick: Now.

Patrick: As I mentioned during our previous call.

Patrick: We do expect.

Patrick: Capex spending to moderate a little bit this year as we get through.

Patrick: Some of these launches.

Patrick: That we talked about right.

Patrick: The smart car and stellar mid.

Doug Ostermann: There's some top hats being industrialized early this year, but we're working our way through that heavy spending that's associated with the new platform strategy. We would expect CapEx to moderate a bit in the second half.

Patrick: Industrialization in Europe.

Patrick: Were happening kind of second half last year heavily theres some top that's being industrialized early this year, but we're working our way through that that heavy spending is associated with the new platform strategy and so we would expect.

Patrick Hummel: Got it. Thanks a lot, Doug.

Patrick: Capex to moderate a bit in the second half.

Operator 2: The next question comes from a line of Michael Tyndall from HSBC. Please go ahead.

Operator: The next question comes from a line of Michael Tyndall from HSBC. Please go ahead.

Speaker Change: Got it thanks, a lot Pat.

Patrick: Sure.

Michael Tyndall: Yeah, thanks very much. Hi, Doug. I got one question around. It's two specific cars, and maybe I've got my facts wrong here. Am I right in thinking that the new Jeep Cherokee and the Ram 1500 Classic replacement were both scheduled to be produced in Mexico? I'm just wondering, does this change the plan at all? I suspect the answer is no. What does it do to the economics of those cars? Because certainly the Cherokee felt like it was going to be a very big contributor to where we were heading to.

Speaker Change: Our next question comes from the line of Mike Tyndall from HSBC. Please go ahead.

Mike Tyndall: Yes, thanks very much.

Mike Tyndall: I got one question around it's two specific cause and maybe I've got my facts wrong here, but I am I right in thinking that the new Jeep Cherokee and the Ram classic replacement with both scheduled to be produced in Mexico.

Mike Tyndall: And I'm just wondering.

Mike Tyndall: Thanks.

Mike Tyndall: <unk> the plan at all I suspect the answer is no, but what does it do to the economics of those cars.

Mike Tyndall: Because certainly the Cherokee felt like it was going to be a very big contributor to where we were heading to.

Doug Ostermann: Yeah. Let me just respond to that. You are correct on the Cherokee replacement. On the kind of what you referred to as the DS or Ram Classic replacement, that's really a trim, you know, kind of a decontented trim that we've been working on of the DT light duty pickup, which is heavily industrialized in Michigan. That would be less impacted. No, I mean, we plan on moving forward with those products. As far as the tariff impact, I think that's a little bit yet to be seen, right? Because the policy is evolving, and we'll, you know, have to see once things kind of settle down and get clarified a bit more.

Mike Tyndall: Yes, So let me just respond to that.

Speaker Change: You're correct on the Cherokee replacement on the.

Speaker Change: Kind of what you referred to as the DFS or Ram classic replacement, that's really a trim.

Speaker Change: Kind of a D content to trim that we've been working on of the.

Speaker Change: DTE.

Speaker Change: Light duty pickup.

Speaker Change: Which is heavily industrialized in Michigan.

Speaker Change: So that would be less impacted.

Speaker Change: But no I mean, we plan on moving forward with those products as far as the tariff impact I think that's a little bit yet to be seen right because the policy is evolving.

Speaker Change: And we will.

Doug Ostermann: Yeah, both those are important steps in our product plan for us.

Speaker Change: We'll have to see once things settle down and get clarified a bit more.

Michael Tyndall: Okay. One very small follow-up, and I suspect you'll tell me to go away. In the absence of tariffs, would the guidance still be the same?

But both of those are important steps in our product plan for us.

Speaker Change: Okay, and one very small follow up and I suspect you will tell me to go away but.

Doug Ostermann: Yeah, go away.

Michael Tyndall: Thought you might say that. I could only try.

Speaker Change: In the absence of tariffs with the guidance still be the same.

Speaker Change: Yes go away.

Doug Ostermann: Thanks very much.

Michael Tyndall: Thanks very much.

Speaker Change: So what you might say.

Speaker Change: [laughter].

Doug Ostermann: Sure. Sure.

Operator 3: The last question comes from a line of Martino De Ambroggi from Equita. Please go ahead.

Operator: The last question comes from a line of Martino De Ambroggi from Equita. Please go ahead.

Speaker Change: Hi, Good evening Charlie question, Thanks, very much.

Speaker Change: Yes.

Martino De Ambroggi: Thank you for taking my question, good morning. Good afternoon, everybody. Trying to summarize on the components, is there any specific problematic area in the components environment, and how much of your components directly or indirectly come from China or Asia? I suppose one of the mitigants that you have in mind is put more pressure on suppliers, as Carlos was very vocal on this.

Speaker Change: And the last question comes from the line of Martin ODM Bragi from equator. Please go ahead.

Speaker Change: Thank you for taking my question good morning, and good afternoon everybody.

Speaker Change: Trying to summarize on the components is there any.

Specific problematic area in the components.

Speaker Change: Environment and how much of your components directly or indirectly come from from China or Asia.

Speaker Change: And I suppose one of the meat again, so you have in mind is put more pressure on suppliers is.

Doug Ostermann: Yeah, I mean, a couple things. One, as I mentioned, you know, roughly 80% of the parts that you find in US assembled vehicles at Stellantis are USMCA compliant, right? So it's really that other 20%. And it of course varies by vehicle, but for the majority of our vehicles, there's not a ton of content coming from China into the United States. You know, a lot of that non-USMCA compliant content as far as parts is coming from places like Mexico, Canada, and some from Europe. It really varies. And I guess I wouldn't characterize it as putting pressure on the suppliers. I think we're taking a bit different approach than that. I would characterize it first as understanding the full supply chain, right?

Speaker Change: Carlos Carlos was very vocal on this.

Speaker Change: Yes.

Speaker Change: A couple of things.

Speaker Change: One as I mentioned.

Speaker Change: Roughly 80% of the parts that you'll find in the U S assembled vehicles at <unk>, Our U S. MCA compliant right. So it's really that other 20%.

Speaker Change: And it of course varies by vehicle, but for.

For the majority of our vehicles is not a ton of content coming from China into the United States.

Speaker Change: A lot of that non U S MCA compliant.

Speaker Change: Content as far as parts is coming from places like Mexico, Canada, Some from Europe, It really varies.

Speaker Change: I wouldn't I.

Speaker Change: I guess I wouldn't characterize it as.

Speaker Change: Putting pressure on the suppliers.

Speaker Change: I think we're taking a bit different approach than that I would characterize it first as understanding the full supply chain right because.

Doug Ostermann: Because even though we think of that 20% directly as coming to us, of course, those tier one suppliers have tier two, tier three suppliers, right? Which might be in different parts of the world. We need to understand the full supply chain and the tariff impacts. Then we need to, frankly, work cooperatively on what are the solutions. Many of the suppliers supply multiple OEMs within the US, and so it's a multi-party conversation. Some of them will be, as I mentioned, in a situation where maybe they have some additional capacity in either the low tariff countries or the United States that they can switch to relatively easily and cost effectively, and others will be much, much more challenged, right?

Speaker Change: Even though we think of.

Speaker Change: That.

Speaker Change: 90% directly.

Speaker Change: As coming to us of course, those tier one suppliers have tier two tier three suppliers right, which might be in different parts of the world.

Speaker Change: And so.

Speaker Change: So we need to understand the full supply chain and the tariff impacts and then we need to frankly work cooperatively on what are the solutions. Many of the suppliers supplied multiple Oems within the U S and so.

Speaker Change: It's a multi party conversation.

Speaker Change: Some of them.

Speaker Change: We'll be as I mentioned in a situation where maybe they have some additional capacity.

Speaker Change: In either low tariff countries or the United States that they can switch to realm.

Doug Ostermann: It's a progressive discussion, and I would say the first step for us is working with the supplier to understand the impacts on their cost structure and then working cooperatively with them on the solutions. I think in terms of timeline, right, that's an important thing for us to address and get after as quickly as possible because there will be, you know, and I don't wanna sugarcoat it here. It does take time for those changes as well. Relative to some of the other options, I think that's a good opportunity for us, as well as, you know, some of the other mitigating circumstances and strategies that I talked about, right?

Speaker Change: Relatively easily and cost effectively and others will be much much more challenge right, but.

Speaker Change: <unk>.

Speaker Change: The progressive discussion and I would say the first step for us is.

Speaker Change: Working with the supplier to understand the impacts.

Speaker Change: On their cost structure.

Speaker Change: And then working cooperatively with them.

Speaker Change: On the solutions, but I think in terms of a timeline.

Speaker Change: <unk>.

Speaker Change: That's an important thing for us to address and get after it as quickly as possible because there will be.

Speaker Change: And I don't want to.

Speaker Change: Sugarcoat. It here it does take time for those changes as well, but relative to some of the other options I think that's a good opportunity for us.

Doug Ostermann: Looking for those opportunities in the market, to gain some share, where we have competitors that are more challenged by the tariffs than we are. You know, looking at where we can flex production among our own plants. There's a lot of different strategies that we will employ, and I think we can be pretty effective at mitigating some of the impacts and making the changes that are needed. At the same time, we wanna continue the dialogue with the administration about what is a reasonable timeline, what are the right types of policies that they can put in place to help us with that kind of cooperative approach. Thank you.

Speaker Change: As well as some of the other.

Speaker Change: Mitigating circumstances.

Speaker Change: Strategies that I talked about we're looking for those opportunities in the market.

Speaker Change: To gain some share.

Speaker Change: Have competitors that are more challenged by the tariffs than we are.

Speaker Change: Looking at where we can flex production.

Speaker Change: Among our own plants.

Speaker Change: So theres a lot of different strategies that we will employ and I think we can we can be pretty effective.

Speaker Change: At mitigating some of the impacts in making the changes that are needed at the same time, we want to continue the dialogue with the administration about what is a reasonable timeline what are the right.

Speaker Change: Types of.

Speaker Change: Policies that they can put in place.

Martino De Ambroggi: Thank you. Thank you, Doug. Any issue on semiconductors, specifically?

Speaker Change: To help us with that kind of cooperative approach.

Doug Ostermann: No, not that I'm aware of, in terms of semiconductors specifically. You probably know that, in terms of the stacking of tariffs, the administration has also been taking some actions to relieve some of the kinda double impact that was a possibility. You may have seen in the announcements like aluminum, steel, and I suspect perhaps semiconductors will come as well. We don't, you know, I think the administration is in a position where they, you know, want to avoid kinda stacking tariffs on top of tariffs.

Speaker Change: Thank you. Thank you. Thank you, Doug and issue on semiconductors, specifically.

Speaker Change: No not that I'm aware of.

Speaker Change: In terms of semiconductors, specifically, you probably know that that in terms of.

Speaker Change: The stacking of tariffs.

Speaker Change: The administration has also been taking some actions to relieve some of the devil kind of a double impact.

Speaker Change: That was a possibility.

Speaker Change: So you may have seen in the announcements like aluminum steel and I suspect, perhaps semiconductors will come as well, but we don't I think the administration is in a position where we.

Philippe Houchois: Okay. Thank you very much, Doug.

Doug Ostermann: Mm-hmm.

Operator 4: This was the last question. Handing back over to you, Doug, to conclude the call.

Operator: This was the last question. Handing back over to you, Doug, to conclude the call.

Speaker Change: Where they want to avoid kind of stacking tariffs on top of tariffs.

Speaker Change: Okay. Thank you very much Doug.

Doug Ostermann: Yeah. Look, I just wanna first off thank everybody for their interest in Stellantis and spending some time with us today. I really appreciate all the thoughtful questions. This is an evolving situation, so I'm sure this will be not the last time that we talk about some of these issues facing the industry in general and Stellantis in particular. Once again, I appreciate all the time that you're willing to spend with us and your interest in our company. Thank you.

Speaker Change: Okay.

This was our last question handing back over to you Doug to conclude the call.

Doug Thanks: Yes, so look I.

Speaker Change: Just wanted to first off thank everybody for their interest in Salon tests and spending some time with us today I really appreciate all the thoughtful questions. This is an evolving situation. So I'm sure this will be.

Speaker Change: Not the last time that we talk about some of these issues facing the industry in general <unk> in particular, but once again I would.

Operator 4: Thank you for joining today's call. You may now disconnect your lines.

Operator: Thank you for joining today's call. You may now disconnect your lines.

Appreciate all.

Speaker Change: All the time that you are willing to spend with us and your interest in our company. Thank you.

Speaker Change: Thank you for joining today's call you may now disconnect your lines.

Speaker Change: [music].

Q1 2025 Stellantis NV Earnings Call

Request a DemoDemo

STLA

Stellantis

Earnings