On July 7, 2021, a view reveals the Stellantis emblem at the entrance to the company’s facility in Hordain, France. Files/Pascal Rossignol/REUTERS (Reuters) – MILAN, July 8 (Reuters) – Stellantis (STLA.MI) calmed investors ahead of its electrification strategy event on Thursday by implying that it had a better than expected start to 2021, despite a chip bottleneck affecting automakers globally. Stellantis, which was founded in January by the merging of Fiat Chrysler and PSA, an Italian-American manufacturer, faces an investor community eager to hear how it expects to develop a range of electrified cars (EVs) to compete with Tesla (TSLA.O). Stellantis will reveal major investments in electrification technology and connected software at its “EV Day 2021,” which begins at 1230 GMT, as it intends to be an industry trailblazer, according to a statement. In April, Chief Executive Carlos Tavares announced that by 2025, practically all of its European models would be available in low-emission variants – either battery or hybrid electric – and that by 2030, they would account for 70% of European sales and 35% of US sales. Jeep, Ram, Opel, Fiat, and Maserati are among the 14 brands owned by Stellantis. Last week, at a similar EV strategy event, European rival Renault (RENA.PA) declared that by 2030, 90 percent of its main brand models would be all-electric, although it had previously included hybrids in its goal. find out more Despite production losses due to a global shortage of semiconductor supply, Stellantis said its adjusted operating profit margins in the first half of 2021 were likely to exceed an annual target of between 5.5 percent and 7.5 percent. At 0800 GMT, the carmaker’s Milan-listed shares were down 3%, lagging the European car index (.SXAP), which was down 2%. The Stellantis margin upgrades were good, but expected, according to Jefferies analysts. The automaker said it expects a “good margin performance” in the first half due to favorable pricing and product mix. “The Stellantis global team has also responded forcefully to production limits imposed by semiconductor shortages, deploying highly effective cost management methods,” the company claimed. Stellantis forecasted a negative industrial free cash flow in the first half, owing to the negative impact of lower-than-expected production levels, which was consistent with earlier estimates. It did say, however, that synergies from the combination were on track to exceed the first year’s target and would enable the company achieve positive cash flow for the year. Annual synergies of more than 5 billion euros ($5.9 billion) have been promised by Stellantis. (1 dollar = 0.8475 euros) Giulio Piovaccari contributed reporting, and Agnieszka Flak and David Clarke edited the piece. The Thomson Reuters Trust Principles are our standards./n
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