Stellantis shareholders authorized a €23.1 million closing pay bundle for former CEO Carlos Tavares on Tuesday.
Round 67% of buyers voted in favour of the remuneration throughout the carmaker’s annual basic assembly in Amsterdam.
The payout features a €2mn base wage, a €500,000 “publish retirement profit expense”, and over €20mn as a part of a long-term incentive bundle — designed to reward workers for milestones.
Tavares’ compensation isn’t with out its critics. Forward of the AGM, Allianz World Buyers and Proxinvest had inspired shareholders to reject the proposal, notably in mild of Stellantis’ disappointing efficiency final yr.
“The pay bundle of €23.1mn for the previous CEO proposed underneath the remuneration report seems overly beneficiant, notably given the lackluster working efficiency and the circumstances surrounding the CEO’s compelled resignation,” Allianz World Buyers mentioned in a press release final week.
“The influence of the revenue warning on the variable pay is simply mirrored within the bonus (with a zero payout) however not within the different elements of the variable pay which might nonetheless grant him a payout of €20.5mn.”
Tavares, who was scheduled to remain in his position till early 2026, resigned in December after a extreme decline in Stellantis’ US and Europe gross sales — hitting earnings.
The carmaker issued a revenue warning in late 2024, forecasting that its adjusted working margin can be between 5.5% and seven% for the yr, in comparison with the earlier expectation of 10%. It added that its free money stream can be within the pink, between €5bn to €10bn, down from a optimistic forecast.
A sudden departure
Tavares had notably clashed with Stellantis’ board over his electrification technique. The CEO was eager to push for 100% battery electrical automobile (BEV) gross sales in Europe by 2030, whereas the board wished to gradual the tempo of the transformation.
After the CEO’s departure, Stellantis mentioned that its search to discover a new chief can be wrapped up earlier than the primary half of 2025, naming Chairman John Elkann because the interim head. Reuters mentioned on Tuesday that Stellantis had now whittled its shortlist down to 5 candidates, citing two folks accustomed to the matter.
The vote this week isn’t the primary time Tavares’ pay has been scrutinised. In 2022, 52% of Stellantis’ voting shareholders rejected a compensation bundle for the CEO, when his pay got here to €19.2mn in 2021, minus long-term incentives.
Whereas Stellantis was in dire straits final yr, politicians — together with Italy’s deputy Prime Minister Matteo Salvini — additionally criticised Tavares for pocketing such a big remuneration.
Tavares had led Stellantis since its creation in 2021, birthed from a merger of Fiat Chrysler and PSA Group.
Trump’s auto tariffs
Buyers will likely be in search of readability as US President Donald Trump flip-flops on auto tariffs. On 3 April, Trump imposed a 25% obligation on automotive imports into the US, whereas a tariff on auto components is ready to kick in on 3 Could.
This week, the president nonetheless advised he could also be open to exemptions, claiming they may give carmakers time to shift their manufacturing to the US.
“I’m one thing to assist a few of the automotive corporations with it,” Trump instructed reporters within the Oval Workplace. “They usually want a little bit little bit of time as a result of they’re going to make them right here, however they want a little bit little bit of time.”
Analysts word that it is going to be a tough promote for Trump to carry automotive producers to the US, particularly as a result of risky nature of his commerce insurance policies. Provided that shifting manufacturing requires lengthy timelines, many companies will likely be unwilling to spend money on such a transfer whereas the tariff scenario is unclear.
“With the present path of painful tariffs and overly inflexible rules, the American and European automotive industries are being put in danger,” Chairman John Elkann mentioned throughout the automakers’ shareholders’ assembly.
He famous that he was, nonetheless, “inspired” by the prospect of a tariff reprieve for carmakers.
