Stellantis NV Faces a Major Financial Shock After a $22 Billion Write‑Down
The stock of Stellantis NV, the European auto‑manufacturing conglomerate listed on the NYSE Euronext Paris, fell sharply on Friday, 7 February 2026, as investors reacted to an unexpected accounting hit and a broader shift away from the company’s aggressive electrification strategy.
A Record‑Setting Hit to the Balance Sheet
In a surprise disclosure, Stellantis announced a $26 billion ($22 billion EUR) impact on its financial statements arising from a reorganisation of its business units. The move included a $22 billion write‑down of assets tied to its high‑profile electric‑vehicle (EV) initiatives, a decision that has been described in the press as “a financial bomb” and “the most ambitious electrification plan ever abandoned.” The write‑down is expected to be reflected in the 2026 financial year, pushing the company’s earnings per share into the negative and confirming the negative price‑to‑earnings ratio that currently stands at ‑8.044.
The announcement came amid a backdrop of broader industry turbulence. Global automakers have been grappling with soaring battery costs, tightening supply chains, and a sudden surge in consumer demand for electric vehicles. Stellantis, once lauded for its ambitious EV roadmap, is now forced to recalibrate its strategy, with the company signalling a pivot back to more traditional powertrains while still maintaining a modest EV portfolio.
Market Reaction
The market responded with a 25–27 % plunge in Stellantis shares across European exchanges. In Milan, the stock dropped 26 %, and in the United States, the price sank to its lowest level since the company’s founding in 2021. The share price closed at EUR 6.11 on 5 February 2026, a decline from a 52‑week high of EUR 13.75 and approaching the 52‑week low of EUR 5.73. Despite the sharp fall, the company’s market capitalization remains substantial at EUR 23.6 billion, reflecting the large scale of its global operations.
Investor sentiment, however, has shifted. Call‑option volumes for Stellantis have risen, suggesting that some traders view the downturn as an opportunity. Yet, the broader STOXX 600 index experienced a rebound of 0.9 % on Friday, indicating that the plunge in Stellantis was an isolated event rather than a systemic sector collapse.
Production Expansion in Mexico
Amid the turmoil, Stellantis has announced a new production line in Mexico, targeting the Ram 1500 pickup truck at its Saltillo plant. The launch is intended to strengthen the company’s presence in the North American market and to offset some of the financial strain caused by the EV write‑down. The decision aligns with a strategy to focus on high‑margin vehicles while still maintaining a foothold in the rapidly growing U.S. pickup segment.
Strategic Implications
The decision to scrap a significant portion of its EV investment has raised questions about Stellantis’s long‑term vision. While the company maintains that it will continue to develop electric vehicles, the scale of the write‑down suggests a shift toward a more balanced powertrain portfolio. Analysts point out that the move could improve short‑term cash flow but may expose Stellantis to competitive disadvantage as global peers accelerate their electrification timelines.
In addition to the financial impact, the company’s leadership structure is under scrutiny. Discussions have emerged about the future of John Elkann as chairman and the potential for a change in the board’s composition to steer the company through the crisis.
Conclusion
Stellantis NV’s announcement of a $22 billion asset write‑down, coupled with a broader $26 billion impact on its financials, has shaken investor confidence and led to a sharp decline in share price. While the company is expanding production in Mexico to counterbalance the loss, its future trajectory will hinge on how effectively it can recalibrate its electrification strategy and navigate a rapidly evolving automotive landscape.
