Stellantis CEO lives up to his reputation
MILAN, Aug 3 (Reuters Breakingviews) - Stellantis (STLA.MI) boss Carlos Tavares is delivering the goods. The group formed in January from the merger of Fiat Chrysler Automobiles and Peugeot-maker PSA reported on Tuesday an 11.4% adjusted operating profit margin for the first half of the year. That thrashed a previous 2021 target of between 5.5% and 7.5%, prompting Tavares to hike his goal for the year to 10%. That’s considerably fatter than the 7.4% that Volkswagen (VOWG.DE), (VOWG_p.DE) is expected to deliver, according to Refinitiv estimates.
Given his track record, Tavares’s upgrade should not surprise. Under his watch, PSA’s adjusted operating margin rose to 8.5% in 2019 from 5.9% two years earlier. His ambitions for Stellantis go beyond that. Yet he now boasts a North American business that delivers consistent double-digit returns. Expected savings of 4 billion euros over four years will give him a further edge. Investors can sit back and enjoy the ride. (By Lisa Jucca)
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