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Stellantis Beat Tesla Stock Price Performance

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Stellantis' share is one year old, Elon Musk is going to Germany and Toyota. All that and more in The morning shift for January 18, 2022.

1st gear: Stellantis

One and a half years ago, Fiat Chrysler and Peugeot announced it they merged to form a new company called Stellantis, and we all had a good laugh, because the name sounded like a new medicine. Well, Stellantis is laughing now. The company debuted in the stock market on this day last year and their shares rose by 60 percent during that time. That means Stellantis beat Tesla, whose shares rose only 27 percent. Stellantis, of course, is still far less valuable.

From Reuters:

However, a strong first year bodes well, Jefferies analysts say [Chief Executive Carlos Tavares] has shown vision and ambition with a "sustained stream of strategic initiatives."

Since forging the world's No. 4 automaker after production, Tavares has mapped a € 30 billion electrification strategy and formed alliances with Amazon and iPhone assembler Foxconn to accelerate the development of software and semiconductors for future connected vehicles. Read more

He has also drawn up plans for five battery factories and entered into agreements with trade unions to continue to streamline its European activities - bypassing potential labor disputes and pushing the company's profit margin up to around 10%.

With the exception of the former Peugeot-controlled spare parts manufacturer Faurecia (EPED.PA), Stellantis 'workforce remained virtually unchanged in the past year at around 300,000 - keeping Tavares' promise not to lay off jobs or close factories after the merger.

All this despite the fact that they are facing a crisis in the semiconductor and supply chain, which cost global carmakers millions of vehicles in lost production last year and which is not expected to ease quickly.

Marco Santino, a partner at management consultants Oliver Wyman, said Tavares lived up to his reputation as a practical man who avoided a "muscular" approach with unions, and that the contours of his strategy were in place.

"The path has already been mapped, it needs to be consolidated," he said. "I do not expect fireworks from his business plan".

Tavares will unveil its future business plan on March 1; I'm sure the word "electric" will be used, though Stellantis has been the largest survivor.

2nd gear: Are you happier with the car buying experience?

A new study says car buyers report that it is still not ideal to buy a new car, according to Automotive News, but that it is better than before the pandemic.

Buyers' satisfaction with the shopping experience from the survey stage to delivery dropped to 66 percent in 2021, a drop from a high of 72 percent in 2020, but an improvement from 60 percent in 2019, according to the survey.

Consumers who made more of their purchases digitally tended to be more satisfied with their experience than those who did more work in person, Cox found. And buyers' satisfaction with their experience while at a retailer also remained above pre-pandemic levels - 75 percent last year, which is essentially unchanged from 77 percent in 2020, but better than 70 percent in 2019, according to the survey .

The results signal that car dealers have adjusted their buying processes during the pandemic in ways that resonate with consumers, although the market remains challenged by the lack of microchips and new vehicles that have pushed prices up, says Vanessa Ton, senior intelligence officer in the industry. head of Cox Automotive.

Consumers reported transaction times at a retailer similar to 2020 and faster than years earlier, and more satisfied with digital options, including when applying for financing, the survey showed.

Ton said she expected consumers would be more dissatisfied with the overall shopping experience with fewer vehicles to choose from and rising prices on those available. Instead, she said, retailers are now offering digital buying opportunities, financing assistance and clean facilities during a pandemic - all of which have made the experience tolerable, even enjoyable.

"I just thought people were so mad at warehouse challenges that it would degrade their experience," Ton said. "But that was not the case at all."

I think customers understand stock shortages well, but price tricks to a lesser extent, even though markups are justified in the market. It is also completely not surprising that customers prefer to buy online, as everyone does with everything else. It's almost like it's uncomfortable to walk into a dealer or something.

3rd gear: Toyota Reduces output

Toyota has felt the global chip shortage less than other automakers, but it feels it now. It said this week that it was reducing production because of it.

From Car news:

In a statement on Tuesday, Toyota said the semiconductor shortage would force it to reduce worldwide production by 150,000 units in February to about 700,000 vehicles. Toyota blamed the downturn in February on the ongoing microchip crisis.

This in turn will make it very difficult to achieve the company's 9 million goals.

"The current demand is very strong, which is why we were aiming for a high production plan for February. But due to the impact of the continuing demand for semiconductors across all industries, we have adjusted our production plan," Toyota said in the statement.

"As a result of the audit, the full-year production forecast for the fiscal year ending March 31, 2022 is expected to be lower than the previous forecast of 9 million units," Toyota said.

Global Purchasing Manager Kazunari Kumakura said after the announcement that achieving 9 million would mean producing more than 1 million units in March alone - a very high order.

"It will be very challenging for us to reach the goal," Kumakura said.

I keep thinking that the car market will return to normal around this time next year, which of course is what I thought around this time last year.

4th gear: Tesla CEO Elon Musk visits Germany

This is probably to see what the hell is going on with the Tesla factory there, which is supposed to have been operational now, but is not. That's because they're in Germany cares about things like the "environment", when it comes to new factories. Still, the news of the visit caused some minor online drama.

From Reuters:

Elon Musk will visit Tesla's (TSLA.O) factory in Berlin in mid-February, the top executive tweeted on Tuesday after speculation on Twitter that he would be in Germany this month.

"Of course I can not comment on every rumor, but it is not true. I am on my way to Berlin in mid-February, not this week," Musk tweeted in response to an article from the website Drive Tesla CA, which quoted a tweet claiming he visited Berlin on January 16th.

Musk added in a separate tweet that rumors surrounding his online travel plans were becoming a "security issue" in response to an apology from the account owner who first wrote the incorrect travel date, Sawyer Merritt.

"Sawyer Merritt" is apparently a real person and has been duly reprimanded.

Elon Musk must be protected at all costs.

5th gear: Related: Electric cars that sell more than diesel engines in Europe

This is primarily due to the rules there. Tesla in particular is doing well, which helps explain why they are desperate to get their German factory up and running.

From Financial Times:

Sales of electric cars in Europe overtook diesel models for the first time in December, preliminary estimates have shown as motorists continued to choose subsidized emission-free vehicles over those that relied on a fuel tainted by the 2015 Volkswagen emissions scandal.

More than a fifth of the new cars sold in 18 European markets, including the UK, were powered solely by batteries, according to data collected for the Financial Times by independent car analyst Matthias Schmidt, while diesel cars, including diesel hybrids, accounted for less than 19 percent of sales.

Thanks to generous government subsidies in Germany and elsewhere, as well as strict rules introduced in 2020 that force EU manufacturers to sell more low-emission vehicles, electricity sales have risen steadily.

The trend accelerated in the last quarter of last year, when Tesla proved to be better able than its competitors to adapt to bottlenecks in semiconductor supply chains by supplying record 309,000 electric cars.

European carmakers also pushed for the sale of electric vehicles in December to reduce their fleet-wide CO2 footprint and avoid fines from Brussels, after prioritizing the production of the most profitable models - mainly highly polluting SUVs - during the supply chain crisis.

Back: GM


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