Stellantis has announced it will take €22.2 billion of charges related to a reorientation of its electric-vehicle programs, with the company recording those charges in the second half of 2025. The move forms part of a broader industry retrenchment as softer demand and evolving policy settings prompt automakers to scale back some EV investments.
Wolfe Research characterized the writedown as a reset after Stellantis' shares plunged by about 25% following a pre-announcement that combined the charge with weak results, a subdued outlook for 2026, a suspended dividend and plans to raise €5 billion of new debt.
Details of the realignment
The €22.2 billion adjustment includes €6.5 billion of cash payments spread over four years. A significant component - €6.7 billion - reflects a write-down of capitalized research and development costs tied to EV programs. Wolfe noted that, unlike some U.S. peers that expense R&D as incurred, Stellantis had capitalized those costs, which makes direct comparisons with companies such as Ford and General Motors less straightforward.
The decision to book the charge in the second half of 2025 signals a material reappraisal of the company’s prior EV commitments. Industry peers such as Ford and General Motors have also reported writedowns in recent quarters as incentives are pared back and adoption slows, according to the reporting accompanying the announcement.
Analyst response and near-term outlook
Following the announcement, Wolfe Research upgraded Stellantis to Peer perform from Underperform. The firm explained that, while the reset is severe, the lack of immediate new negative catalysts supported moving to a more neutral rating. Wolfe expects some sequential improvement in earnings and free cash flow across 2026 and 2027, aided by new vehicle launches that could bolster U.S. market share and introduce operating leverage.
Despite that anticipated improvement, Wolfe still projects free cash flow will remain negative in 2026 and only reach breakeven in 2027. The brokerage highlighted execution risks and intense competition in Europe and other markets as factors that could influence the recovery path.
Looking ahead
Wolfe also observed that expectations may rise ahead of Stellantis’ strategy update scheduled for May, though the firm does not foresee major strategic changes that would materially alter the company’s recovery trajectory. The firm’s assessment thus sits between acknowledging the severity of the writedown and recognizing a limited set of immediate additional negatives for the stock.
This repositioning by Stellantis and the analyst response underscore the challenges automakers face in calibrating EV investments amid shifting demand and policy signals, and set a specific timeline for when the market might begin to see financial improvement.