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Shares have fallen by more than half and shareholders are losing enthusiasm. Whole discussion on Stellantis has basically collapsed. Somebody said, how do you get access to the Patreon? A link is pinned to the top of the chat and it’s in the description of the video. We’re not talking about free cash flows. We’re not talking about long term strategy. We’re not talking about market position. Nobody wants that Dodge Dart. Nobody wants. Let me see this. We’re not talking about free cash flows. We’re not talking about long term strategy. Let me ask you all a question because I literally just just put in a call.
I think I’m ordering the challenger, the hellcat, the demon. I don’t really like the name of that, but I think I’m going to order one just to keep it for nostalgic purposes. So I think that the value of them is going to go up over over a period of time. How many of y’all want that? That’s the electric version of the charger that’s coming out is being released now. It’s the electric version. I do like electric cars, but they, I think they charge like 70, 80, $90,000 for that. 70, 80, $90,000 for a Dodge electric car.
People want choices. They don’t want to be forced into it. We’re not talking about market position or the China elite motor joint venture. We’re only talking about how much will it cost the company to get rid of the U.S. inventory. As a result of the disappointing U.S. sales, profits have fallen by nearly 50 percent and market share is down. It is an understatement to say that H1 2024 results were disappointing and humbling. The dealer body and evidently the UAW as well believes we’re on a bad track. It was all self-inflicted. On September 30th, 2024, the company slashed its forecasts for full year profitability and cash flow.
The stock plunged nearly 13 percent by closing. There is mounting pressure on Stellantis, his CEO, and calls for him to step down. So how did Stellantis get to this place and can it recover? That right there is so funny. I was talking to a guy as I was coming out of Home Depot and he noticed me and he was telling me that he actually worked there. So a lot of people don’t know that Chrysler. OK, so let me give you a little bit of history. Chrysler basically was partner with or bought by Daimler. Right.
So Mercedes and all that. Eventually they spun them off. They sold them over there. And then Stellantis wound up picking up Chrysler, which also encompasses Dodge and Ram. OK, that is an urban hills. Auburn Hills is a suburb of Detroit. It is in Metro Detroit. It is not a Detroit automaker. It is a Michigan automaker. That is the headquarters. It’s still got the Chrysler signers at the top. OK, the interesting thing about that is that I was talking to the guy that was at Home Depot and he was telling me that he worked in that building and he said it is a very, very, very hostile workplace.
He said you can work in that building and never see people that’s over there or over here or over there or so on and so forth. And that, you know, a segment and all of that. All of those people that work in that headquarters, a lot of them are already laid off and they let them go. I believe that Chrysler, if somebody doesn’t buy it from Stellantis, Chrysler, Jeep, Ram, Dodge is all going kaboosh. It is going to be three American automakers, not four, because now the fourth one became Tesla. Tesla is doing really well.
They got the best margins. I believe it’s only going to be Ford General Motors. And Tesla, I believe that within a few years, I think that Chrysler is going to completely go out of business. But let’s listen to it. Check out these charts. There’s Stellantis financial results for the first half of twenty twenty four. The stock’s full year performance as of early October shares have fallen from a high of twenty nine fifty one in March to just above 13 dollars. And it’s mostly due to poor US sales of its American brands. It isn’t the only automaker going through tough times, but it is one that has lost significant market share to its rivals over the last three years.
They can’t keep it to several offices because of Stellantis’s national dealer to open order to the company using management and less emissions going into the air. They can’t keep it. Dave Kelleher is a Dodge, Jeep, Ram and Chrysler dealer in Pennsylvania. Three years ago, dealers like Kelleher were earning profits of about four point five percent of sales, which is strong for the industry. The benchmark is four percent. But now Kelleher says the average is less than one percent. That’s caustic. We have nine dealers are scary. They’re actually losing money in a bunch that are really close to it.
In the same time period, the values of those dealerships have plummeted from five to five and a half times earnings to one to two times, depending on the dealership’s location. Kelleher is selling 100 cars a month, whereas he used to sell about 185. As of mid-September, he had 473 cars on his lot, collectively worth about 27 million dollars. Bear in mind, dealers buy their cars directly from the automaker. Kelleher has been selling these cars his entire career and has seen the ups and downs. This time, he says the troubles are of Stellantis’s own making.
Dealer morale is low, corporate morale is at an all time low. So I would suggest that this company, I don’t know what their plan is because they certainly don’t tell us. But if you guys work at Stellantis, Chrysler Dodge or anything like that, I don’t care if you work in a plant. I don’t care if you work in corporate. I would be looking for another job. I would be as I would have been in school. I already told you in the final nail in the coffin. Honest to God, the final nail in the coffin was you see something real quick.
The final nail in the coffin was this UAW contract because it basically priced them out of being able to compete. Nobody is going to be paying one hundred thousand dollars per truck or one hundred thousand dollars for Chrysler or Dodge or anything like that. And they had to raise the consumer prices for research and development to continue to transition over into electric because the Biden Harris administration is that is is forcing every automaker to move over to electric. And when they start paying all those workers, all of that money, the layoffs was coming.
And the minute that they approved that contract, I said that it was over. I said that Sean Fane basically nailed, put a nail in the coffin for all Chrysler workers in the United States of America. The only thing that they’re going to be able to do is import cars or hopefully sell it over to a larger automaker in which they can share platforms. And then they’re just going to rebrand or badge everything as a Dodge or a Stellantis or a Dodge or a Ram or something like that. But nobody wants to pay $80,000 for Jeep.
Nobody wants to pay $90,000 for an electric vehicle and interest rates is high and people can’t even afford to live and stuff anymore. It’s not happening, bro. It’s not happening. The minute that they signed that UAW contract, it was over. It was completely over for Stellantis here in the United States of America. Nobody want to Dodge, Dart, rebadged, fiat. Nobody want that. Nobody want a. It’s not happening, bro. It’s over. For two and a half years, we’ve explained to them that we think we’re on a bad path and nothing’s been done to it. The dealers aren’t the only discontent stakeholders.
The United Auto Workers Union has been threatening to strike again. And earlier in 2024, Stellantis suppliers were halting production over pricing disputes. The disputes have spilled into the courts. North America operations were, you know, highly profitable and kind of seen as a little bit of a cash cow. Maybe the idea was it could run itself with not much influence, but it still needed support. Stellantis has only existed for about three and a half years. It was created out of a merger of two major automakers, France’s Group PSA, sometimes known as Pujo, and Fiat Chrysler, which was itself a merger of two other companies, the Italian maker Fiat and the American Chrysler.
A company with a long and tumultuous history. Chrysler has always been the weakest of the three major producers in the United States. It had the smallest market share of the Detroit 3, the three major automakers based out of Detroit, Michigan. Here’s what volumes look like for the Detroit 3 in 2007, one year before the financial crisis. By 2009, Chrysler and GM both went bankrupt. Chrysler will file for bankruptcy after failing to reach a deal with some of its debt holders. Then came the merger with Fiat. The continuity of Chrysler was at risk. So whether you like this decision or not, it is the only path that kept Chrysler alive.
It’s gone through certainly more than one near death experience in my lifetime. And it’s a testament really to the brains and work ethic of the people at the company that have really pushed Chrysler back in the brick each time. A revival followed under the leadership of former FCA CEO, the late Sergio Marchione, whose turnaround at Chrysler was at times considered miraculous and at others marred by controversy. He went in and he understood that he needed to make these brands like superstars. So he went into the engineering and he built the entire product portfolio. He found these people that really were terrific, like a Tim Caniskis, for example, who took Dodge brand and just made Dodge brand vibrant again.
No, I don’t think that it was him. I think it was Ralph. Was it Ralph Giles? Ralph Giles? Tim Maniskis, he the person that they now have put in charge of Chrysler now. It wasn’t him. It was Ralph Giles that really reinvigorated from a design lens of what was going on over at Chrysler. Whatever they’re talking about is nonsense. It was the Ralph dude that absolutely changed Chrysler. The Jeep, Dodge and Ram brands all set sales records in 2018. The Ram truck was taking share from its competitors, the F-150 and the Silverado. The Dodge Challenger was a muscle car, a declining segment, and the car itself saw a few significant updates over its lifetime, but that didn’t matter.
It eventually outsold both the Chevrolet Camaro and the Ford Mustang. Despite all the success, Fiat Chrysler’s board was long known to be looking for a deal. First with the American GM, then the French maker Renault and then Peugeot. Welcome back Jeep parent company, Fiat Chrysler merging with European automaker Peugeot to create the fourth largest automaker in the world. Peugeot had a strong presence in Europe. The company had already bought GM’s Opel and Vauxhall brands. In some sense, it seemed like a natural fit. The two companies in that sense were already very accustomed to co-developing products together.
They knew each other’s cultures already because they’ve been in heavy collaboration for, you know, since the 80s on those commercial vehicles. So culturally, it made sense. But there was also the opportunity to cut costs and save billions of dollars through synergies, such as sharing parts and platforms. This could also reduce the burden of investing in extremely expensive new technologies like EVs, automated driving and software, and of course, pay money out to shareholders. And at first, the market was quite doubtful whether Stellantis could pull off the five billion in synergies between the two companies that they had announced.
Jeremy Rogers says, Anton, are you still getting a Cybertruck? I don’t know. I don’t know. There’s so many different cars that I want and there’s so many cars that I got on order. I don’t know if it makes sense. I will say that now they got out like the non-foulder series. I don’t know. We’ll see what happens, bro. We’ll see how it plays out. I don’t know if I’m going to get one. We’ll see. We’ll figure it out. And then we’ll play it from there. But they basically ran it into the ground. I don’t think that it’s going to exist as its own independent automaker anymore.
I think that the brand is absolutely going to be killed. And I think that it’ll be sold off because the value of the name still exists. The Ram name still is great. The Jeep name is still as great. Even Dodge, you can make something out of it. But the fact that they’re pushing everybody to go over to EV is going to be a difficult play for a lot of people. So anyways, neither here nor there. That’s all I got for y’all today. [tr:trw].
See more of The Millionaire Morning Show w/ Anton Daniels on their Public Channel and the MPN The Millionaire Morning Show w/ Anton Daniels channel.
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