The dream of the global car industry to deploy the same technology across a range of brands around the world has long been under pressure, and recent events have further pushed a once-profitable strategy further into the darkness.

“The difficulties of Stellantis continue to cast doubts about the global brand conglomerate business model,” Phillipe Houchois, analyst at the bank Jefferies, wrote in an investor note following the resignation of CEO Carlos Tavares on 1 December.

The battle between Tavares and the Stellantis board was more about management style than results, but his future at the company was in doubt the moment that it warned in October of substantially reduced deliveries in its key US market after the failure to shift the predicted quantity of Jeep and Ram vehicles..

In juggling 14 brands, Stellantis's focus on the urgent need to fill gaps in its European line-up took precedence over fixing similar problems among its American models.

“A big, big chunk of the decline in market share is simply because we have been blank in some very key opportunistic segments,” Stellantis CFO Doug Ostermann said during the Goldman Sachs autos conference on 4 December. 

He referenced the lack of a replacement Jeep Cherokee (one is due in mid-2025), saying: “Not having any SUV entry in the largest segment of the market, for a brand like Jeep, is a is a big hole to fill.”

Meanwhile, also on 4 December, American giant General Motors said it was booking a $5 billion writedown on its once thriving business in China “to address market challenges and competitive conditions”.

It said the charges related to plant closures and “portfolio optimisation”, the latter likely referring to model reduction across its Buick and Chevrolet ranges.

GM long ago decided that it couldn’t make its European operations pay, selling Vauxhall/Opel to the PSA Group (now part of Stellantis) back in 2017. 

Ford stayed but continued to struggle to sell cars profitably in the region. In November, the company said it was cutting a further 4000 jobs across Europe as it faced “significant competitive and economic headwinds”. 

Ford has already significantly shrunk its offering, axing the best-selling Fiesta, Mondeo, Galaxy, C-Max and Focus. The brand’s focus is now on ‘hero models’ that relate more to its American heritage, as well as its profitable van range.

Meanwhile, the Volkswagen Group’s problems in China are legion as comes to terms with losing a once -dominant market share to local brands, who are proving more nimble at targeting a tech-hungry car-buying public.

The German giant counted on the MEB electric car platform to work across Europe, China and, to a lesser extent, the US across its various brands. 

However, Chinese buyers in particular have shown reluctance to buy Volkswagen EVs without a big discount, cutting the firm's profit in the first nine months of this year by 37% to €1.2 billion. Next year, that profit will fall to €600 million, the bank UBS forecasts.

Meanwhile, the once-popular Skoda brand sold just 14,311 cars in the 10 months to the end of October in China, according to data from bestsellingcarsblog.com, while the budget Jetta brand was down 28% to 91,990 sales.

Stellantis under Tavares has been generous in allowing each of its 14 brands time to prove themselves, despite the seemingly outsized task for the weaker ones, like DS and Maserati, and the potential for overlap.

“A house of brands looks nice, because of volume, but it only works where you have clear brand distinction playing in different segments,” former Nissan executive Andy Palmer told Autocar.

“Each brand has its own marketing and sales costs and inevitably the products get more diverse as each brand tries to assert its own identity.”

Stellantis has also yet to fully streamline its new multi-energy platforms across multiple brands, unlocking those economies of scale.

Meanwhile, the vast and growing gulf between American and European vehicle tastes remains a problem. 

As the three big global markets of the US, Europe and China diverge further and further, one solution for global brands is to work closer with local specialists. 

For example, Ford has taken the Volkswagen Group's MEB platform to build the Explorer and Capri EVs in Europe, while Volkswagen itself is hooking up with Chinese firm Xpeng to use its EV platforms to fast-track new EVs in China, scheduled for 2026. And Audi has gone with MG parent SAIC to kick-start its more localised and techy China offering, previewed by the recent AUDI E electric estate concept.

Like-minded companies are coming together to get around the difficulty of engineering cars for a legislation or market tastes that might be increasingly different from those in your home market.

“Mitsubishi had gone from Europe almost entirely but is returning in a bigger way with Renault,” said Ian Henry, director of AutoAnalysis. “It's possible that more Japanese [firms] could adjust their strategy to Europe by having vehicles made for them under contract.”

This is becoming more pressing with the need to sell a greater number of EVs in Europe – a technology on which Japan is lagging.

The threat of greater US import tariffs under new president Donald Trump is another barrier that will force the minds of car companies used to importing models.

Chinese cars are effectively banned in the US, due to a 100% import tariff and the planned sanction on Chinese-made software and electronic hardware within vehicles. 

However, American car makers’ preferred low-cost base of Mexico is also in the sightlines of Trump’s protectionism, favouring those with factories on US soil but also pushing up car prices even further.

Stock analysts are pretty gloomy about the medium-term future of global car companies, partly due to their exposure to a myriad of global protectionist issues. 

Increasingly car companies are responding by retrenching back to their home market or at least their core regions, especially if the problem market is no longer financially viable.

“The number-one goal is not to inject more capital from the US into China,” GM CFO Paul Jacobson told the UBS conference on 4 December.

Not everyone is suffering. Aside from growing difficulties in China, the global premium brands are likely to ride out the current problems, thanks to higher pricing power and – in the case of BMW, Mercedes-Benz and Volvo – factories in the US.

The Korean brands too have adapted better to the European and American markets, even if they’ve largely abandoned China.

Stellantis’s US problems, however, are on track to be cured a lot faster than those of GM and the Volkswagen Group in China. Although it lost its leader in the fallout, it might be better placed under Tavares’s successor to make a renewed case for being a true global automotive brand conglomerate in a time when that business model is most under threat.