Stellantis dealerships are already shouldering the burden of having to deal with several massive recalls while also contending with massive shifts in consumer buying trends. However, a growing inventory problem is now having these dealerships ask for help as Stellantis is forced to undertake quick actions to try and curb the tide of excess vehicles.
Growing inventory putting the squeeze on dealerships
The glut of excess vehicles entering Stellantis showrooms is putting the squeeze on many franchise owners with some of them asking for help from management in an attempt to curb the flow of excess inventory. These pleas for help reportedly led to a conversation between Stellantis CEO Carlos Tavares and the Stellantis National Dealer Council according to a report from Automotive News
The main issue that has risen to the forefront is unequal distribution of trim levels among model allocations with the bulk of the inventory often being undesirable trim levels and equipment configurations with desirable model combinations often being in short supply. This imbalance has caused dealerships to lose sales with some customers moving away from Stellantis and into another brand. Stellantis for its part says that the company is already aware of the situation but for many dealerships, it’s too little, too late.
Slumping First Quarter Sales
The growing inventory problem is the latest in a recent string of bad news for Stellantis with the company seeing an 8% drop in sales across the majority of its brands with Fiat and Alfa Romeo being the lone exceptions. Ram and Dodge in particular have taken a beating with both of these brands reporting declines of 26% and 16% respectively. Jeep has also experienced sales declines with the discontinuation of the Jeep Cherokee and Renegade and slumping Wagoneer demand all playing a role in making its sales go down with pricing increases also hurting sales of its other models including the iconic Jeep Wrangler.
The loss of entry-level models like the aforementioned Cherokee made things even more challenging for dealerships since that left them without entry-level models and forced them to try and market other vehicles with higher trim levels with these models often being accompanied by higher price tags.
“They had a $350 payment on a Cherokee. I can’t move them to a $650 payment on a Grand Cherokee, so I don’t have anything to offer them,” David Kelleher, owner of David Chrysler-Dodge-Jeep-Ram in Pennsylvania, told Automotive News. Situations like Kelleher’s are rampant and are a sign of just how rampant the problem is across Stellantis’s entire dealer network.
Stellantis resorting to price cuts
Stellantis for its part is attempting to address the glut of inventory by rolling out price cuts with the Grand Cherokee getting a $2,000 to $4,000 price cut while other models also get similar cuts. Dealerships are also expanding cashback programs to further entice customers inside especially for key models.
These problems are unwelcome news for Stellantis as it prepares to unleash its first wave of EV models onto customers. The 2024 Dodge Charger & Charger EV and the Jeep Grand Wagoneer S are all coming later this year and will eventually be joined by several other EVs including the Ram 1500 REV. The addition of these models will require dealerships to have plenty of room to take them in and we hope that Stellantis will enact procedures to avoid having similar trim issues for the EVs.
Carl Malek has been an automotive journalist for over 10 years. First starting out as a freelance photographer before making the transition to writing during college, his work has appeared on numerous automotive forums as well as websites such as Autoshopper.com.
Carl is also a big fan of British vehicles with the bulk of his devotion going to the Morgan Motor Company as well as offerings from Lotus, MG, and Caterham. When he is not writing about automobiles, Carl enjoys spending time with his family and friends in the Metro Detroit area, as well as spending time with his adorable pets.