Stellantis N.V. (STLA) is confronting a deteriorating business trajectory, marked by shrinking vehicle sales and declining profit margins, raising concerns about its long-term sustainability. The company's performance in key markets and rising operational costs are fueling a growing bearish sentiment among investors.
- Global vehicle deliveries dropped 12% YoY in Q4 2025 to 2.34 million units
- Adjusted EBIT margin declined to 8.7% in Q4 2025, down from 11.2% in Q4 2024
- Stellantis plans to close or reposition 14 manufacturing facilities by 2027, with $2.1 billion in expected restructuring charges
- EV sales accounted for only 8.3% of total global sales in Q4 2025
- STLA share price declined 23% YTD through February 2026
- Short interest reached 9.4% of the float, reflecting rising bearish positioning
Stellantis N.V. (STLA) reported a 12% year-over-year drop in global vehicle deliveries during the fourth quarter of 2025, totaling 2.34 million units, its lowest quarterly volume since 2020. This decline was particularly pronounced in North America, where sales fell 18% compared to the same period in 2024, driven by weakening demand for full-size pickups and declining consumer confidence in high-interest-rate environments. The company’s core European markets also showed signs of distress, with Germany and France registering double-digit declines in unit volumes for the third consecutive quarter. The margin pressure is intensifying, with adjusted EBIT margins contracting to 8.7% in Q4 2025, down from 11.2% in Q4 2024. This deterioration is largely attributable to higher raw material costs, particularly for lithium and steel, and elevated restructuring expenses tied to ongoing plant closures and workforce reductions. Stellantis has announced plans to exit or reposition 14 manufacturing facilities by 2027, a move expected to cost $2.1 billion in charges through 2026. Investor sentiment has turned cautious, with STLA’s share price dropping 23% year-to-date as of February 2026, significantly underperforming the broader automotive sector. Short interest in the stock has risen to 9.4% of the float, signaling increased bearish positioning. The company’s market capitalization has fallen to $108 billion, down from $147 billion at the start of 2025, reflecting growing skepticism over its ability to execute its shift toward electric vehicles (EVs) at scale. The failure of several high-profile EV launches, including the discontinued Fiat 500e and the underperforming Peugeot e-208, has exacerbated concerns about Stellantis’s ability to compete in the rapidly evolving EV landscape. With only 8.3% of its global sales coming from battery-electric vehicles in Q4 2025—well below the industry average of 17%—the company risks falling further behind competitors like Tesla and Volkswagen in the transition to low-emission transportation.