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Rival carmakers BMW, Mercedes and Volkswagen all said in the last month they would face lower profits this year, citing weaker demand.<\/p>\n

In its update, Stellantis said: \u201cDeterioration in the global industry backdrop reflects a lower 2024 market forecast than at the beginning of the period, while competitive dynamics have intensified due to both rising industry supply, as well as increased Chinese competition.\u201d<\/p>\n

It said its expected fall in profit was partly down to lower-than-expected sales performance in the second half of the year across most regions. It was also driven by increased costs linked to an overhaul at its US business, which includes the Chrysler and Dodge brands, to address the oversupply of vehicles in America.<\/p>\n

The carmaker said it was looking to cut the supply of cars to the US by 200,000 this year, in an attempt to \u201cnormalise its inventory\u201d by keeping the number of vehicles available at dealers in the US at 330,000. It would also use increased incentives to buyers to help clear old stock.<\/p>\n

The company is now projecting negative industrial cashflow ranging from -$5bn to -$10bn, compared with previous guidance that had expected positive cashflow.<\/p>\n

Stellantis is the latest European carmaker to cut its profit forecast as slowing growth in electrical vehicle sales translates into weaker global demand for new vehicles.<\/p>\n