Here's How Stellantis Is in Even Worse Shape Than Its Rival -- but Clear Upside Remains

Stellantis has faced steeper declines than its U.S. rivals over the past three years, with its stock down about 60%. The Italian-dominant automaker is counting on a $70 billion turnaround plan to regain market share, deliver new products, and lift margins. Investors are watching its effort to reduce costly warranty expenses, which jumped to $7.4 billion in 2025, well above Ford’s $5.73 billion. When assessed as a percentage of revenue, Stellantis’ warranty load runs about 4.4%, higher than the historical 2-3% norm, underscoring quality and cost challenges ahead.

Despite the challenges, the $70 billion turnaround offers upside if Stellantis can regain lost market share, launch a more compelling product lineup, and reduce warranty costs as the plan progresses through the second half of the decade. The company’s warranty expense surged to $7.4 billion in 2025, and after robust product launches, management expects automotive gross margin improvements from R&D efficiency and supply chain fixes. The investment thesis hinges on quality upgrades and profitable growth, but it remains conditioned on cost discipline and market recovery. Analysts will closely watch warranty trends.