The Corporate Saga Behind Jeep’s Downfall

Stellantis NV, the Dutch-headquartered Franco-American-Italian car company that owns Jeep—along with Dodge, Ram, Peugeot, Citroën, Alfa Romeo, Maserati and a hodgepodge of other makes— is struggling to resurrect a storied brand whose sales had collapsed.  The efforts are pushed by John Elkann, the 49-year-old billionaire chairman of Stellantis, who for the time being was also the de facto chief executive officer. Having ousted the CEO, Carlos Tavares, two months earlier, Elkann had a massive cleanup job on his hands.  

Of the many strategic blunders Tavares made during his four-year reign over what was once a $93 billion conglomerate, perhaps his most egregious was the mismanagement of Jeep, Stellantis’ crown jewel. He jacked up prices and increased production of Jeep’s most expensive trims, without adequately investing in new products, which left gaping holes in an aging lineup and swelling inventory on dealer lots. The extent of the damage became clear in July 2024, when Stellantis reported that its net income had been cut almost in half. By September, exasperated dealers sent an open letter to Tavares accusing him of destroying the company’s brands.

The lanky, lower-profile Elkann runs a family-controlled holding company in the Netherlands, Exor NV, which had €38 billion ($45 billion) in net assets at the end of 2024, with the Agnelli family stake valued at about €10 billion. Not only is Elkann responsible for managing the fortunes of 100 or so relatives, he’s also trying to transform Italy’s legacy companies into international giants that can survive another century. That quest has become more difficult as incumbent automakers struggle to compete in the age of electrification and the rise of China.

If Stellantis, formed from the 2021 merger of Fiat Chrysler and France’s PSA Group, is Elkann’s link to the past, it’s also his problem, and a drag on his portfolio. “John Elkann longs to trade pistons for pixels, yet the road from Mirafiori to Silicon Valley is treacherous and muddy,” says Carlo Alberto Carnevale Maffè, a professor of business strategy at Milan’s Bocconi University, referring to the site of Fiat’s headquarters. “He’s perhaps betting on sleek M&A to redefine the empire, but the rust in Europe’s car industry demands more than a visionary’s touch to shine.”

With Tavares out, Elkann and the board had begun scouring the globe for a unicorn CEO: someone who understood manufacturing and auto retail, but who also had a clear vision for a future increasingly defined by software and batteries instead of internal combustion; a turnaround whiz who knew the US market but could navigate the internal politics of the three-way culture war among the company’s American, French and Italian fiefdoms, not to mention a 248,000-person global workforce and restive unions; someone who could manage a newly assertive chairman and board filled with appointees safeguarding dynastic wealth and national interests. It’s as much a turnaround job as it is a sort of United Nations ambassadorship. And that was just the internal assignment.

After trying to lure several external CEO candidates, the post sat open for almost six months, until late May, when Elkann and the board finally announced that they hadn’t poached an outsider to lead the company in its fight for survival but had promoted someone internally. Antonio Filosa, an Italian who’d successfully run Stellantis’ South American division and had been with the company for 26 years, would be the new CEO. Filosa’s profile had risen amid an exodus of senior management under Tavares; only seven months earlier he’d been promoted to run the North American operations. But in many ways, anointing him as CEO was a tacit admission of what no one was willing to say aloud: Outside talent wasn’t exactly clamoring for this job.

Jeep was certainly not the only damaged brand, but it had the most to lose. Its value is almost mythical in the auto industry. Few vehicles are as deeply embedded in the American psyche as a Wrangler, cruising around in summer without its roof or doors.

But the paradox of Jeep is that it’s an off-road vehicle, and off-roading is niche. The more you try to expand it, the further you risk straying from what makes it unique. Many suitors have offered to take Jeep off Chrysler’s hands since Iacocca acquired it in 1987, and many an executive has defiled it while trying to multiply its riches.

The company miscalculated again in 2021, when it brought Jeep into the luxury realm with the three-row Wagoneer and Grand Wagoneer, turning the rugged rock crawler into a land yacht topping out above $100,000. When the move upmarket backfired, Jeep didn’t have enough competitive mainstream models to fall back on.  Jeep was losing customers to more affordable brands such as Hyundai and the boxy Wrangler rival, the Ford Bronco.

While an internal hire meant the new chief wouldn’t need time to learn the culture or diagnose what had gone wrong, it also reinforced just how unattractive the role was to outsiders, staring down the barrel of more losses, possible downsizing and the tariff mess. Filosa’s appointment also signaled the company’s internal shift in power from France back to Detroit and Elkann’s home country of Italy, whose factories had been gutted under Tavares.

In late July, Filosa had his coming out—his first Stellantis earnings call as CEO. The company had already frontloaded the grim news earlier: a $2.7 billion loss in the first half of the year, with the bulk of the tariff pain still to come in the second half. Filosa introduced himself as a leader who fixes problems and runs toward tough decisions, but it quickly became apparent that he still had fires to put out before he could offer any grand blueprint to fix the company. Filosa talked about reversing plunging sales in the US and Europe with upcoming products, but cautioned that a new plan wouldn’t be ready until early next year.

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