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Stellantis 2024 Investor Day highlights: Powerful differentiators, unique flexibility and exceptional returns

Stellantis is a highly differentiated OEM lending it specific advantages against a dynamic and disruptive industry backdrop

Just over three years since its formation, Stellantis has successfully established itself as a leading global automaker and, even more importantly, one that through the execution of its Dare Forward 2030 long-term strategic plan is even better positioned to face the challenges ahead. Today, at Stellantis’ first Investor Day, CEO Carlos Tavares outlined nine key strategic differentiators the Company is leveraging to unlock value and address the disruption and reinvention of the auto industry worldwide.

Stellantis key strategic differentiators fortified by Dare Forward 2030

Best Positioned Core

  • Portfolio of 14 iconic and innovative brands covering all price points and multiple regional markets
  • Global market presence combining scaled North America and Enlarged Europe regions with rapidly expanding 3rd Engine1
  • Unique multi-energy approach, spanning products, platforms, manufacturing and supply chain

Clear Profitability Advantages

  • Fully scaled Pro One commercial vehicle business, with mid-to-high teens profitability, and positioned to achieve global leadership
  • Ability to deliver double-digit margins across the cycle, with a < 50% break-even point
  • Sustainable R&D/CAPEX efficiency, a key component of a powerful capital plan

Critical Speed & Agility

  • Re-set and re-launch of asset-light China strategy with Leapmotor, a top 3 Chinese EV startup brand in 2023
  • Leveraging global reach to maximize Best-Cost Country opportunities
  • Rapid development of next-gen portfolio and accretive affiliate businesses

The “3rd Engine” refers to an aggregation of the South America, Middle East & Africa, China and India & Asia Pacific segments.

“Today we are a unique company by nature and a powerful carmaker by performance, well-equipped to deliver through tough times and win the long game. Our global presence, powerful technology and brand portfolio span across diverse products – ranging from quadricycles to luxury cars – giving us an enviable customer reach,” Stellantis CEO Carlos Tavares told attendees.

“What consumers around the world are looking for is clean, safe and affordable mobility. This is the reason we exist. We are driving a generational shift in technology and a product wave built on multi-energy platforms and flexible operations with above-group profitability in our commercial vehicles business. Together with the activation of our uniquely aligned partnership with Leapmotor, an innovative Chinese new energy vehicle maker, we’re confident we can deliver what customers want while providing strong shareholder returns this year, and beyond.”

In addition to the CEO’s overview of the Company’s key strategic differentiators, which are unlocking exceptional opportunities, members of the Top Executive Team also gave updates spanning several areas of the business.

North American Chief Operating Officer Carlos Zarlenga discussed 2024 actions taken to restore market share, improve inventory dynamics, and capitalize on specific low emission vehicle growth opportunities in the medium-term.

Enlarged Europe Chief Operating Officer Uwe Hochgeschurtz reviewed the Company’s multi-faceted response to rising competition from Chinese OEMs.

Middle East & Africa (MEA) Chief Operating Officer Samir Cherfan reviewed the many benefits of an increasingly localized approach to serving the MEA region, supporting the stand-out growth and profitability of Stellantis’ “Third Engine”.

Jeep® CEO Antonio Filosa, Ram CEO Chris Feuell and Peugeot CEO Linda Jackson discussed how a powerful, strategically focused product wave expands the market opportunities of each.

Chief Engineering and Technology Officer Ned Curic, Chief Purchasing and Supply Chain Officer Maxime Picat and Chief Manufacturing Officer Arnaud Deboeuf focused on Stellantis’ extraordinary management of the value chain with flexible platforms, products and operations, with particularly valuable multi-energy capabilities, able to address different scenarios.

Assessing key 2024 financial drivers

CFO Natalie Knight also provided a financial review highlighting Stellantis’ key 2024 performance drivers and considerations.

“Stellantis is responding decisively to near-term challenges, including optimizing inventory while executing a generational product transition,” said Natalie Knight. “Despite the related short-term headwinds, we remain confident in our ability to deliver double-digit profitability, among the best OEMs in the world, while continuing to deliver exceptional capital returns to shareholders.”

Stellantis management confirmed its 2024 financial guidance and capital return plan:

  • Double-digit Adjusted Operating Income (AOI) margin and positive industrial free cash flows.
  • Capital Return: Delivering ≥€7.7 billion in dividends and buybacks in 2024.

CFO Natalie Knight reiterated more specific color on first and second-half expectations within the 2024 period:

  • H1 outlook of 10-11% AOI margin, with industrial free cash flows visibly below the prior year period.
  • Significant product launches, cost initiatives and anticipated improvement in working capital together support H2 sequential improvement opportunity in AOI and industrial free cash flow.

The Company also enhanced its capital plan in several significant ways:

  • Setting target liquidity levels of 25-30% of revenues for the mid-term, shifting focus to capital efficiency and supporting strong shareholder returns.
  • The Company will continue to use share buybacks and ordinary dividends to return excess cash to shareholders.
  • In 2025, the Company will target the upper range of its 25-30% dividend payout policy, vs. 25% in recent years.

The 2024 Stellantis Investor Day hosted analysts, investors, and media in Auburn Hills, Michigan, U.S. For those unable to view the Stellantis Investor Day webcast, a recorded replay and the presentation material will be available under the Investors section of the Company’s corporate website:

SOURCE: Stellantis

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