Stellantis CEO Antonio Filosa said the automaker will implement a global cost-cutting program as he seeks to build on his recovery plan, which delivered a €377 million first-quarter profit after a €387 million loss a year earlier.

Filosa did not offer specifics about the cost-control measures, which he called the Value Creation Program, or VCP, except to say that it would focus mainly on North America and Europe and that its targets would be “ambitious”.

The program “will most likely also include fixed cost management,” Filosa said. He disclosed the program in a quarterly results call on April 30. More details about the VCP will be revealed at a capital markets day in Auburn Hills, Michigan, on May 21, Filosa said.

Comeback started?

Stellantis has begun a comeback under Filosa, who became CEO in June, six months after Carlos Tavares stepped down following a surprise profit warning.

Stellantis reported an operating margin of 2.5 % for the first quarter of 2026. Some regions had better results than others. South America and the Middle East/Africa posted double-digit margins, while the North America margin was 1.6%, and Europe was 0.1%.

Stellantis booked a positive impact of around €400 million in tariff refunds after a US court ruling. Without the expected refunds, operating income in North America would have been negative.

The announcement of the Value Creation Program comes as one of Stellantis’ biggest rivals, Volkswagen Group, announced sweeping cost cuts, including eliminating 50,000 jobs in Germany by 2030 and trimming excess capacity.

Stellantis, like VW, has significant excess capacity in its European factories. Stellantis is ending car production at its Poissy factory near Paris and is reportedly in talks with Chinese automakers about selling or sharing other at-risk plants.

US: improvement expected

Filosa told investors that North America would show sequential margin improvement for the rest of 2026, citing higher orders for vehicles with Hemi V-8 engines, “high-profit” Jeep models, and the Dodge Challenger Sixpack with a turbocharged 3.0-liter six-cylinder engine.

He said Hemi powertrains accounted for 40% of Ram pickup deliveries in the quarter. Profits will improve despite the continued impact of tariffs, estimated at €1.3 billion for 2026, and a €1 billion headwind from higher raw-material prices.

The relaunch of the Hemi in Ram pickups, an engine program that was canceled under Tavares, is “good for volume, mix and profit per unit,” Filosa pointed out. He also said the launch of new models, including the high-performance Ram 1500 SRT TRX pickup, Jeep Wagoneer extended-range EV, and Jeep Recon electric SUV, would boost profits. “Revenue and mix will keep growing all year,” he stated.

Europe: more caution

Filosa was more cautious about Europe, saying the region (including the Balkans and Eurasia) would reach “breakeven plus” the remainder of the year. An ever-tougher competitive landscape, marked by the growth of Chinese entrants, means pricing will remain flat, he said, and any profits would depend on cost controls through the Value Creation Program.

Deliveries and sales in Europe were up in the first quarter, but heavy discounts and incentives led to a pricing impact of negative €441 million. Other brakes on profits in Europe are light-commercial vehicle sales and set-asides for emissions fines, Filosa and CFO Joao Laranjo explained.

That stands in contrast to North America, where higher margins from Hemi-equipped pickups led to a €200 million improvement in pricing in the quarter.

Geo-political impact

Filosa briefly touched on the impact of the conflict in the Middle East and the subsequent rise in fuel prices. He said in Europe, Stellantis is seeing increased orders for its small electric cars on the Smart Car architecture, while in the US, there is high interest in its lone full-hybrid model, the Jeep Cherokee, which has a 1.6-liter engine and fuel economy of 37 miles per gallon.

Filosa explained that he also did not envision any partnership with Chinese automakers in the US for now, although he noted that the collaboration with Leapmotor, in which Stellantis holds a 20 percent stake, is expanding in Europe and South America.

“We started commercially only with the Leapmotor International joint venture, but our mutual interest in discussing all potential industrial partnerships is growing,” Filosa concluded.