GM's and Ford's stocks drop after Jeep owner Stellantis cuts profit-margin view

By Steve Gelsi

Stellantis warns of more intense competition from China.

General Motors Corp.'s stock and Ford Motor Co.'s stock dropped Monday after Jeep owner Stellantis NV warned it's facing tighter profit margins due to increased competition from Chinese automakers and lower wholesale shipments.

Stellantis's stock (STLA) was down nearly 14% after it said it now expects adjusted 2025 operating margin of 5.5% to 7%, well below its previous estimate of a double-digit operating margin.

The stock dropped to below $14 a share for the first time in about two years.

Ford's stock (F) fell 2%, while General Motors shares (GM) moved lower by 3.1%.

Stellantis said it's encountered "deterioration in the global industry backdrop reflects a lower 2024 market forecast."

The company now expects twice the number of inventory declines of 200,000, up from 100,000, in North America in the second half of this year.

It's planning to increase its use of sales incentives and boost productivity in cost and capacity.

"Competitive dynamics have intensified due to both rising industry supply, as well as increased Chinese competition," the company said.

Prior to Monday's moves, GM's stock was up 29.4% in 2024, while Ford was down 11.6%. The S&P 500 SPX has risen about 20.3% in 2024.

-Steve Gelsi

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09-30-24 1103ET

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