Stellantis is set to bear a €1.5bn (£1.3bn) burden from President Donald Trump's hefty tariffs on cars this year, despite the trade agreement reached between the European Union and United States earlier this week.
The car manufacturer, which owns brands such as Vauxhall and Fiat, confirmed in a mid-year update that it had already faced levies of €300m on its US exports this year, and anticipates that figure to significantly increase following the US-EU trade pact, as reported by .
The €1.5bn impact is at the upper limit of the €1.0-€1.5bn range it provided last week alongside its preliminary results, which also disclosed a 13 per cent decrease in net revenues resulting in a loss of €2.3bn.
These grim figures were largely confirmed in its final half-year earnings on Tuesday, causing shares in the Milan-listed group to drop by as much as 4.8 per cent in early trading on Tuesday, before reducing losses back to 1.6 per cent.
The tariff revelation is one of the largest confirmed by a major European exporter since Donald Trump announced his initial wave of tariffs on carmakers in March.
It is also the first major company to issue formal guidance on tariffs in the aftermath of the deal struck by the European Union and US on Sunday to avert the worst of Donald Trump's projected import taxes.
EU officials negotiated a 15 per cent tariff on member states' exports to the US – reduced from the threat of 30 per cent levies taking effect in August – whilst simultaneously announcing multibillion pound investments into America's energy and defence sectors.
However, the agreement triggered several harsh criticisms from European political leaders, with many cautioning that the conditions would create additional pressure on Europe's already faltering economy.
Stellantis 'realistic about challenges'
French Prime Minister Francois Bayrou described the agreement as a "submission" by the bloc, calling it a "dark day" for European interests.
Meanwhile, German Chancellor Friedrich Merz cautioned that despite the terms being the "best result achievable", they would inflict "considerable damage" on his country's export-dependent economy.
Alongside revealing its tariff exposure, Stellantis confirmed it anticipated revenue and cash flow would recover following a difficult year in which its shares have almost halved in value.
The company's electric vehicle operations have found it difficult to compete against the surge of affordable Chinese rivals in Europe and the US, whilst many of its leading brands have been unable to update their product ranges as quickly as rivals.
"Our new leadership team, while realistic about the challenges, will continue making the tough decisions needed to re-establish profitable growth and significantly improved results," newly appointed chief executive Antonio Filosa said. Filosa assumed control at Stellantis in May, following the sudden resignation of his predecessor, Carlos Tavares, last year due to "different views" between him and the board.
