Legacy automaker Stellantis (STLA) has been facing some labor troubles in Italy, reports of late note. In fact, even the government is starting to get concerned about the state of the country’s car industry. But Stellantis will not be cutting any jobs in Italy, at least not on any major scale. At least, not for now. Investors found these promises placating enough and sent shares up over 2.5% in Thursday afternoon’s trading.
Italy’s Industry Minister, Adolfo Urso, held a meeting in Rome with a range of trade dignitaries, and the topic came up that Stellantis’ Italian brands—particularly Lancia, Alfa Romeo, and Fiat—are in decline. That is usually the time when most businesses start looking to make cuts, but according to human resources manager Giuseppe Manca, Stellantis “…does not intend to close any plants in Italy, just as it has no intention of making collective redundancies.”
Stellantis is Italy’s biggest automaker, but with projections of under 500,000 units to be produced this year, concerns are mounting. That is the lowest number of cars Italy has produced since 1958. Given that, just a week ago, Stellantis cut nearly 1,100 jobs from its Toledo assembly plant, the idea that job cuts would reach elsewhere was not out of line.
Electrics are Looking Up
But even as overall production looks to be in open decline, there is one market where Stellantis is doing somewhat well: electric vehicles. A new report direct from Stellantis’ corporate communications says that its electric vehicle operations are doing quite well.
Stellantis holds an overall market share of 17.5% in electric vehicles, which includes 12.5% of the battery electric vehicle (BEV) market and 31% of the commercial vehicle (CV) market. It currently leads the way in the French, Italian, and Portuguese markets while being well-represented in the German, Spanish, and British markets as well.
Is Stellantis Stock a Good Buy Right Now?
Turning to Wall Street, analysts have a Hold consensus rating on STLA stock based on seven Buys, 11 Holds, and two Sells assigned in the past three months, as indicated by the graphic below. After a 29.68% loss in its share price over the past year, the average STLA price target of $15.02 per share implies 11.67% upside potential.
