Jeep, Ram dealers slam parent company for 'degrading' brands

A US dealer group has sounded off at the parent company of Jeep, Ram, Dodge and Chrysler, accusing it of mismanaging the American brands.

The US used to be the most profitable market for Stellantis – parent to the aforementioned brands after a 2021 merger between Fiat Chrysler Automobiles (FCA) and Groupe PSA – but it has recently faced some major hurdles.

Reuters reports Stellantis’ operating income in the first half of 2024 fell by 40 per cent, while Ram and Jeep sales in the US have fallen by more than one-third compared to 2019.

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In a letter to Stellantis CEO Carlos Tavares, Stellantis National Dealer Council chairman Kevin Farrish – who runs a Jeep, Ram, Dodge and Chrysler dealership in Virginia – accused the company of ignoring warnings which has led to “disaster” for all involved.

“We are writing this letter on behalf of the entire US dealer network and its employees. The intent of this letter is to sound an alarm – an alarm to not only you, but to the Stellantis board of directors, your employees, your investors, and your suppliers,” Mr Farrish said in the letter.

“For over two years now, the US Stellantis National Dealer Council has been sounding this alarm to your US executive team, warning them that the course you had set for Stellantis in the US was going to be a disaster in the long run. A disaster not just for us, but for everyone involved – and now, that disaster has arrived.

“In 2023, you engineered a record year of profitability for Stellantis, earning you the title of the highest-compensated automotive CEO. You personally earned a record amount of almost US$40 million (A$59.6 million) that year.

“Unfortunately, the engineering and structuring of that year have led us to exactly where we told your executives we would be today. The reckless short-term decision-making to secure record profits in 2023 has had devastating, yet entirely predictable, consequences in the US market.

“Those consequences include the rapid degradation of our iconic American brands – brands like Jeep, Dodge, Ram, and Chrysler that have over a century of history in America.

“The market share of your brands has been slashed nearly in half, Stellantis stock price is tumbling, plants are closing, layoffs are rampant, and key executives fleeing the company. Investor lawsuits, supplier lawsuits, strikes – the fallout is mounting. Your own distribution network, your dealer body, has been left in an anaemic and diminished state.

“Unfortunately, these are just the consequences we feel today. The drastic market share downturn will have a long lingering painful fiscal impact on your parts manufacturing business for many years to come.

“The pain will not be confined to the company and its investors. Your dealer network, their employees, your suppliers, and most of all, your own workforce – everyone will suffer the consequences of these disastrous choices.

Mr Farrish added he didn’t want Mr Tavares to apologise or resign, instead calling on him to “get your employees … back to work by building and selling cars that Americans want to buy and can afford”.

“Let us clear out this old inventory now and get the plants working at full capacity. Yes, in the very short term, it will be painful for Stellantis, but mistakes at this level usually are,” said Mr Farrish.

The dealer group representative also invited Mr Tavares to the National Dealer Council’s meeting with Stellantis executives at the company’s Detroit headquarters next month.

While Mr Tavares didn’t directly respond to Mr Farrish’s letter, Stellantis’ US division did, labelling it as a “personal attack”.

“We take absolute exception to the letter sent by the president of the Stellantis National Dealer Council, Kevin Farrish,” the carmaker said.

“Last month, we introduced an action plan developed with the dealer body that has already shown results. August sales were up 21 per cent over July, market share was up 0.7 points, and dealer inventory was reduced for two consecutive months by 42,000 units or approximately 10 per cent in total.

“This is the result of working together with our dealer network and we want to thank them for their constant support and engagement. We meet and talk monthly, have weekly calls and personal conversations at the highest level. This is where such dialogue should take place.

“At Stellantis, we don’t believe that public personal attacks, such as the one in the open letter from the NDC president against our CEO, are the most effective way to solve problems. We have started a path that will prove successful.

“We will continue to work with our dealers to avoid any public disputes that will delay our ability to deliver results.”

It’s not the first time within the past month that Stellantis has come under fire for how it’s handled its US brands.

Frank B. Rhodes Jr., great grandson of Walter P. Chrysler, launched a campaign to bring Chrysler and Dodge home to the US by buying the brands back from Dutch-headquartered Stellantis to form a new Chrysler Corporation.

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