Stellantis under the microscope, rumours of a review of its strategy in South America

(Il Sole 24 Ore Radiocor) - Stellantis under the microscope on the Milan Stock Exchange (FTSE MIB ) following reports by Bloomberg that the group is reviewing its technology strategy in South America under competitive pressure from Chinese manufacturers, and news of the possible sale of its Canadian plant in Brampton.

More specifically, according to the Chief Operating Officer for South America, Herlander Zola, the group is reportedly reassessing its strategy for South America, which was defined three years ago, and is evaluating electrification options, including a flex-fuel version of the range-extender technology developed with Leapmotor and vehicles powered by sugarcane bioethanol, and will present an updated technology roadmap by the end of the year. Zola identified Jeep as the brand most adversely affected by the Chinese offensive, with market share losses in Brazil and Uruguay, and is banking on the launch of the Avenger to regain ground. “The news appears to confirm the critical issues already highlighted,” comment analysts at Intermonte, who emphasise “a context of growing volumes (+15% in the first half of 2026)”. However, Stellantis does not appear to be reaping the full benefits of this growth, “with Chinese players gaining market share (from 4.3% to 7.6%) whilst the group’s volumes remain broadly stable, raising some concerns about the long-term sustainability of the region’s historically double-digit margins”.

At the same time, according to the Canadian trade union Unifor, Stellantis is reportedly considering closing and selling its plant in Brampton (Ontario), partly due to the impact of tariffs imposed by the US administration. “The group has not yet given formal notice, but has said it is open to a sale”, reports Intermonte, whilst the Canadian government is in talks with the company, the trade union and the province of Ontario to safeguard production and jobs. “The Brampton plant has been at a standstill since 2023 and has a capacity of 200,000 units per year (around 7 per cent of Stellantis’ US capacity and 37 per cent of its Canadian capacity),” the experts continue, adding that “the outcome of a potential sale remains to be seen in light of negotiations with Unifor, whose contract expires in September and which is aiming to safeguard jobs”.

Finally, the market is also reacting to the car manufacturer’s announcement regarding an increase in investment in the Belvidere plant, in Illinois, to over $800 million, to convert it to use Stellantis One, the group’s new modular platform, and to produce the next generation of the Jeep Cherokee there. Pilot production is scheduled for the first half of 2028, whilst the start of retail production is now expected in the second half of 2029. This investment, analysts explain, ‘represents an increase on the $600 million announced last October for the reopening of the plant and the expansion of Cherokee and Compass production’. The Cherokee is currently produced in Mexico, where, however, tariffs and logistics costs are weighing on the model’s profit margins.