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Jeep, Ram Dealers Criticize Parent Company for 'Degrading' Brands

A U.S. dealer group has criticized the parent company of Jeep, Ram, Dodge and Chrysler, accusing it of mismanaging its American brands.

The US used to be the most lucrative market for Stellantis — the parent company of the aforementioned brands following the merger of Fiat Chrysler Automobiles (FCA) and Groupe PSA in 2021 — but the company has faced significant headwinds of late.

Reuters Stellantis' operating profit in the first half of 2024 reportedly fell 40 percent, while Ram and Jeep sales in the U.S. fell by more than a third compared with 2019.

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In a letter to Stellantis CEO Carlos Tavares, Stellantis National Dealer Council Chairman Kevin Farrish, who runs Jeep, Ram, Dodge and Chrysler dealerships in Virginia, accused the company of ignoring warnings, leading to a “disaster” for everyone involved.

“We are writing this letter on behalf of the entire U.S. dealer network and its employees. The purpose of this letter is to sound a wake-up call – a wake-up call not just to 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, the Stellantis US National Dealer Council has been sounding the alarm to your US management team, warning them that the course you have set for Stellantis in the US will 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 the title of the highest paid CEO in the auto industry. 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 led us to exactly where we told your leaders we would be today. Reckless short-term decision-making to ensure record profits in 2023 had devastating but entirely predictable consequences in the U.S. market.

“These consequences include the rapid degradation of our iconic American brands – brands like Jeep, Dodge, Ram and Chrysler, which have more than a century of history in America.

“Your brands' market share has been cut almost in half, Stellantis' stock price is falling, factories are closing, layoffs are in full swing, and key executives are fleeing the company. Investor lawsuits, supplier lawsuits, strikes – the consequences are mounting. Your own distribution network, your dealer corps, are left in an anemic and declining state.

“Unfortunately, these are just the effects we are experiencing today. A sharp decline in market share will have long-term financial pain for your parts business for many years to come.

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

Mr. Farrish added that he did not want Mr. Tavares to apologize or resign, instead calling on him to “put his employees … back to work making and selling cars that Americans want to buy and can afford.”

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

A representative of the dealer group also invited Mr. Tavares to a meeting of the National Dealer Council with Stellantis executives at the company's headquarters in Detroit next month.

While Mr Tavares did not respond directly to Mr Farrish's letter, Stellantis's US unit did, calling it a “personal attack”.

“We strongly object to the letter sent by Stellantis National Dealer Council President Kevin Farrish,” the automaker said.

“Last month we presented an action plan developed jointly with the dealer organization, which has already shown results. Sales in August were up 21 percent compared to July, market share increased by 0.7 points, and dealer inventories were reduced over two consecutive months by 42,000 units, or about 10 percent in total.

“This is a result of working together with our dealer network, and we want to thank them for their continued support and involvement. We meet and communicate monthly, have weekly calls and have face-to-face conversations at the highest level. This is where this dialogue should happen.

“At Stellantis, we do not believe that public personal attacks, such as the NDC president's open letter against our CEO, are the most effective way to resolve issues. We have begun a path that will prove successful.

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

This is not the first time in the past month that Stellantis has come under fire for how it handles its American brands.

Frank B. Rhodes, Jr., great-grandson of Walter P. Chrysler, launched a campaign bring Chrysler and Dodge home to the United States by purchasing the brands from Stellantis, headquartered in the Netherlands, and forming a new corporation, Chrysler.

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MORE: Chrysler Family Wants to Reclaim Iconic Brands from Stellantis



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