Shares of Stellantis (NYSE: STLA), the global automotive giant that owns former Chrysler brands like Jeep and Ram, fell sharply on Friday after the company announced massive write-offs amid lower-than-expected demand for electric vehicles.

As of 1:15 p.m. ET, Stellantis's U.S.-traded shares were down about 24.5% from Thursday's closing price.

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Over $26 million to unwind an aggressive EV plan

Stellantis announced a whopping 22.2 billion euros ($26.5 billion) of charges before the U.S. markets opened on Friday. Most are related to downsizing its ambitious EV plans; some address overall quality issues.

The charges include:

• 14.7 billion euros related to product-plan changes. That includes write-offs for recent models that aren't selling as well as expected, charges for the work put into future products that have now been cancelled, and payments to suppliers that had geared up to make parts for models that now won't be made.

• 2.1 billion euros related to downsizing the company's plans for an EV supply chain, mostly related to planned investments in battery manufacturing.

• 5.4 billion euros in "other charges" including an increase in the amount the company sets aside for warranty work -- an acknowledgment that recent quality-improvement efforts haven't delivered results.

Several rivals, including Ford Motor Company (NYSE: F) and General Motors (NYSE: GM), have announced similar EV resets amid flagging demand in the U.S. and Europe. But none have been as costly as Stellantis's changes, and neither Ford nor GM investors saw anything like the hit Stellantis's stock took on Friday.

Stellantis now expects an operating loss for the second half of 2025

Stellantis, which reports earnings semi-annually, also said that it now expects to post a loss of 1.2 billion to 1.5 billion euros on an adjusted operating basis for the second half of 2025. The company has suspended its dividend payments for the time being.

Stellantis will report its complete second-half and full-year 2025 results on Feb. 26.

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Not long ago, electric vehicles (EVs) were heralded as the inevitable successors to gas-powered cars, promising a green revolution on wheels. Automakers dove headfirst into the hype, unveiling ambitious blueprints for fleets of battery-powered models and pouring billions into factories, batteries, and tech to spearhead the shift.

Yet, consumer enthusiasm never matched the buzz—range anxiety, high costs, and charging woes kept buyers at bay. The tipping point came when U.S. government subsidies evaporated under policy changes, leaving the EV market parched. Sales plummeted, forcing giants like Ford (F) and General Motors (GM) to swallow massive losses and retreat. Now, Stellantis (STLA) joins the wreckage, its EV dreams derailed in a costly crash.

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About Stellantis Stock

Stellantis is a global automotive powerhouse formed from the 2021 merger of Fiat Chrysler Automobiles and PSA Group. It designs, manufactures, and sells vehicles under iconic brands like Jeep, Ram, Dodge, Chrysler, Fiat, Alfa Romeo, Peugeot, Citroën, and Opel, spanning luxury, mainstream, and commercial segments. Headquartered in Amsterdam, the company operates worldwide, with strong footholds in North America, Europe, and emerging markets, producing everything from compact cars to heavy-duty trucks.

Originally, Stellantis aimed high on EVs under former CEO Carlos Tavares, targeting 100% electric sales in Europe and 50% in the U.S. by 2030. It invested heavily in four battery EV (BEV)-native platforms (STLA Small, Medium, Large, and Frame) and battery tech to roll out dozens of models. However, EV sales lagged; in 2025, U.S. deliveries totaled just 1.2 million vehicles overall, with BEVs capturing a meager share amid broader market slowdowns.

So far in 2026, STLA stock has tumbled 34% year-to-date, far underperforming the S&P 500's ($SPX) modest 1.2% gain over the same period. It is crashing 25% today, and over the past year, shares are down 45%, versus the S&P's 12.16% advance. Valuation metrics paint a bargain picture: forward P/E at 6.35, below the auto industry average of 8 to 10; forward P/S at 0.17, half the sector's 0.4 to 0.6; P/B at 0.36, versus the industry's 1.2 to 1.5; and P/CF around 1.9, under historical norms of 4 to 6. These ratios suggest undervaluation—a low P/S indicates cheap revenue multiples, P/B shows assets exceed market cap, and P/CF highlights strong cash generation relative to price—making STLA appealing for value investors despite headwinds, at least on the surface.

Stellantis announced it is taking a $26 billion (22 billion euro) hit as it shuffles its electrification strategy, posting the largest write-down on EVs of the Detroit Three automakers.

The announcement came overnight on Feb. 6, with Stellantis publishing estimated figures for its full-year performance in 2025. On top of the high cost of restructuring, the brand said it will also post a net loss for all of 2025.

"The charges announced today largely reflect the cost of over-estimating the pace of the energy transition that distanced us from many car buyers’ real-world needs, means and desires," said Stellantis CEO Antonio Filosa in a news release.

Filosa also said the previous decisions made by the company are responsible for the losses of today.

"(The charges) also reflect the impact of previous poor operational execution, the effects of which are being progressively addressed by our new team," he said in the statement. Filosa took over as CEO of the international automaker in June and quickly shuffled around the executive leadership. Stellantis struggled on both Wall Street and dealerships under former CEO Carlos Tavares, who resigned in late 2024.

Stellantis' $26 billion hit is the largest of the Detroit Three, though all automakers have paid high costs as the country's playbook on electric vehicles has shifted significantly, with federal incentives slashed and tariffs strongholding companies into bringing production back to the United States.

Ford Motor Co. recently said the pivot to its new EV strategy will cost $19.5 billion. General Motors, too, said it will spend about $7.1 billion to account for EV production changes. Stellantis' costs to de-electrify are almost equal to both Ford and GM's costs combined.

As a result of the charges and the net loss for 2025, the company announced it would not be paying out a dividend this year. Stellantis stocks closed at $9.54 a share on Thursday. By the time the markets opened on Friday, the stock was trading around $7, a 25% dip.

Stellantis said the $26 billion charges can be attributed to a few things.

First, the company said, it will spend approximately $17.3 billion to realign its product plans to meet customer preferences and lax emissions regulations, saying it has "significantly reduced expectations for BEV products."

Write-offs on canceled products, like the fully electric Ram 1500 truck, cost about $3.4 billion. The brand will also be "resizing" its EV supply chain, spending about $2.4 billion as it trims assets and contracts related to battery production.

In fact, Stellantis sold off its stake in a Canadian battery development joint venture the same morning, already making a move on its plan to shrink its footprint in the international EV supply chain.

Stellantis (STLA) reported a massive charge of 22 billion euros ($25.94 billion) as it resets its electric vehicle business.

Cash payments of 6.5 billion euros ($7.7 billion) will be paid out over the next four years, and charges totalling 14.7 billion euros ($17.34 billion) will be taken against the company’s 2025 second-half results, Stellantis said. The charges won’t impact Stellantis adjusted operating income, however.

“The charges announced today largely reflect the cost of over-estimating the pace of the energy transition that distanced us from many car buyers’ real-world needs, means and desires,” Stellantis CEO Antonio Filosa said in a statement. “They also reflect the impact of previous poor operational execution, the effects of which are being progressively addressed by our new Team.”

Stellantis stock tumbled as much as 25% Friday, closing down nearly 24%.

"The charges come at a cost, a very needed reset," Filosa added on a conference call with analysts. "It is a strategic, profound, reset."

Cash payments over the next four years are related to canceling certain products as well as some ongoing EV products “whose volumes are now expected to be considerably below prior projections,” Stellantis said.

The biggest chunk of the charges is related to realigning production plans with customer preferences, as well as the impact of new US emissions regulations instituted by the Trump administration, which reflect “significantly reduced expectations for BEV products.”

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These include write-offs for canceled products and impairments to some EV platforms, the company said.

Other charges include changes to the EV supply chain, such as batteries; other non-EV charges, like warranty provisions; and workforce reductions in Europe.

As a result of the losses, Stellantis said it will not issue a dividend, and the board has authorized a 5 billion euro ($5.9 billion) non-convertible bond offering to shore up its financing.

Stellantis’ massive write-off comes after GM (GM) took a cumulative $6.6 billion hit from its EV business in December, which followed Ford’s (F) $19.5 billion charge in the same month.

Looking ahead to 2026, Stellantis projects a mid-single-digit revenue increase, and a AOI margin in low-single-digits. The company will issue full financial results on Feb. 26.

Pras Subramanian is Lead Auto Reporter for Yahoo Finance. You can follow him on X and on Instagram.

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Stellantis NV (NYSE:STLA, EPA:STLA) shares opened a massive 25% lower on Friday after the automaker announced a €22.2 billion charge tied to scaling back electric vehicle (EV) projects and refocusing on hybrids and traditional gas engines.

The company said the write-downs included scrapping projects such as the Ram 1500 REV and prioritizing the return of V8 engines, along with new Jeep and Dodge models.

Stellantis now expects a net loss of up to €21 billion in the second half of 2025, with a low single-digit operating margin for the full year, including roughly €1.6 billion in tariff-related costs. The company also plans to issue up to €5 billion in bonds to strengthen its balance sheet. Detailed full-year results are scheduled for February 26.

The restructuring is part of a broader strategy reset, which also includes a record $13 billion US investment over four years.

The company’s market value in Italy lost more than €5 billion to about €18 billion, marking one of its worst trading sessions ever.

CEO Antonio Filosa pointed to strategic missteps under his predecessor, Carlos Tavares, saying the EV-heavy approach failed to adapt to changing market demand. “The charges announced today largely reflect the cost of over-estimating the pace of the energy transition that distanced us from many car buyers’ real-world needs, means and desires,” Filosa said in a statement. “They also reflect the impact of previous poor operational execution, the effects of which are being progressively addressed by our new team.”

Stellantis’ massive charge follows similar EV pivots by US automakers Ford and General Motors, which together have booked more than $50 billion in writedowns this year as they reassess electric vehicle investments.

Stellantis (STLA) is finding its stock down 24% ahead of Friday's market close after the US automaker announced it will write-down $26 billion in charges tied to its EV business.

Yahoo Finance Senior Autos Reporter Pras Subramanian reports more on this news.

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