Stellantis, formed by the merger of Fiat Chrysler Automobiles (FCA) and Peugeot Société Anonyme (PSA), was created to address the challenges faced by the global automotive industry. The group’s portfolio of brands put it in a strong position in Europe, North America, South America, and had the potential for growth in Asian markets.
As of January 2021, Stellantis was the fourth-largest automaker globally, with 6.2 million units sold in 2020. While its sales volume increased to nearly 6.5 million units in 2021, it dropped to 5.84 million units in the following year. With 14 brands under its umbrella, Stellantis had a direct competitor in the form of the Volkswagen Group.
The European Challenge
The competition between Stellantis and Volkswagen went beyond just volume; it also involved profitability. Both companies faced the challenge of transitioning from the internal combustion engine sector to the electric car sector without sacrificing profits. Though there were areas for improvement – Volkswagen with its software and Stellantis with more models – both companies managed to maintain their dominant positions in their respective markets.
However, a significant gap emerged in their most crucial market, Europe. According to data on new car registrations in 28 European countries, Stellantis was losing ground not only to newcomers like Tesla and Chinese brands but also to Volkswagen.
The Gap Widens
The gap between Stellantis and Volkswagen averaged 4.7 points between January 2021 and June 2022. However, since then, the gap has widened to 8.6 points and continues to grow. In July 2023, Volkswagen Group recorded its highest monthly market share in two years, surpassing Stellantis by 11.9 points. This is the largest gap between the two groups since Stellantis was founded and could potentially widen further in the coming months.
Stellantis Needs More Products
Both Stellantis and Volkswagen are striving to catch up in the electric car market. The demand for battery-powered cars is strongest in Germany, while most European consumers still prefer petrol-powered cars. Between January and July 2023, Volkswagen Group registered 244,000 new electric cars in Europe, leading the growth in this sector. Volkswagen’s market share in the Battery Electric Vehicle (BEV) segment increased from 21% in 2022 to 22.5% in 2023, a 58% volume increase.
On the other hand, Stellantis saw a modest 11% increase in BEV registrations, reaching a 13.2% share. Stellantis offers four SUVs out of its 24 electric models, while Volkswagen offers eight electric SUVs out of its 14 different electric models. In terms of petrol-powered cars, Volkswagen has a significant advantage with 54 models available, including 25 SUVs, compared to Stellantis’ 46 models, including 21 SUVs.
Will the gap between Stellantis and Volkswagen continue to grow? Or will Stellantis catch up by expanding its lineup of SUVs and fully electric vehicles?
Source: Felipe Munoz – JATO Dynamics