Patrick Hummel

Patrick Hummel asked for clarification on whether the previous management's statement about positive AOI in North America for the second half is still valid, given the volume bounce. He also inquired about the qualitative puts and takes for cash flow heading into next year, specifically if higher investments are expected due to the $13 billion U.S. plan, and if next year's free cash flow is confidently expected to be positive.

Answer

CFO Joao Larangeira stated that Stellantis is not providing regional guidance but is focused on sequential improvement quarter by quarter. Regarding free cash flow, he mentioned that despite the U.S. investments, the focus remains on monthly investments around 8% of revenue. He added that the strategic plan adjustments are still being assessed, and a final figure for next year's impacts is not yet available, with updates to be provided with full-year financials.

Patrick Hummel asked if the previous management's statement about positive North American AOI in H2 2025 was still valid, given the volume bounce. He also inquired about the qualitative puts and takes for cash flow heading into 2026, considering higher investments from the $13 billion U.S. plan and potential trailing effects of one-off announcements, asking if positive free cash flow for 2026 could be confidently projected.

Answer

Head of Investor Relations Ed Ditmire stated that Stellantis is not providing regional guidance but is focused on sequential improvement. He also mentioned that despite U.S. investments, the company aims for monthly investments around 8% of revenue, and it's too early to project 2026 free cash flow, with updates to follow after full-year financials.

Patrick Hummel from UBS Group AG raised concerns about the company's cash flow, noting the significant cash burn in H1. He asked about balance sheet priorities, the cash absorption of the financing arm (Finco), and the outlook for shareholder returns. He also followed up on the brand portfolio strategy.

Answer

CEO Antonio Filosa linked improved cash generation directly to volume and profit growth. CFO Doug Ostermann added that the cash burn rate is decreasing and the focus is on improving AOI and stabilizing working capital to achieve positive cash flow. He clarified the Finco's net cash outflow is manageable. Regarding the brand portfolio, Mr. Filosa confirmed a detailed strategy update will be presented at the Q1 2026 Capital Markets Day.

Patrick Hummel of UBS Group AG asked about production flexibility at the Tuscaloosa plant to increase SUV output as a tariff offset. He also questioned the inventory levels of U.S.-made GLE and GLS models in China and the potential sales impact later in the year.

Answer

CEO Ola Kallenius confirmed that the Alabama plant has the flexibility to increase SUV production if market demand shifts, though the overall impact is difficult to predict. CFO Harald Wilhelm stated that GLE and GLS inventory in China is sufficient to last well into Q2 and that the potential impact from prohibitive tariffs is factored into the guided 300 basis points risk assessment.

Patrick Hummel from UBS questioned the production flexibility at the Tuscaloosa, U.S. plant to increase SUV output as a tariff mitigation strategy. He also asked about the inventory levels of U.S.-made GLE and GLS models in China and whether they are sufficient to sustain sales for the year.

Answer

CEO Ola Kallenius confirmed that the Alabama plant has flexibility to increase SUV production if market dynamics shift, but noted the overall impact is difficult to predict. CFO Harald Wilhelm stated that GLE/GLS inventory in China is sufficient for Q2, and the potential impact of prohibitive tariffs later in the year is included in the guided 300 basis point risk.

Patrick Hummel from UBS inquired about Mercedes-Benz's long-term strategy in China, questioning the right capacity, product mix, and entry-segment presence in a persistently challenging market. He also asked how the company will maintain a fresh ICE product lineup as it launches BEV-only platforms like MBEA, and what this means for investments.

Answer

CEO Ola Kallenius outlined a three-pronged view of China: a technology race Mercedes is committed to winning, a subdued macroeconomic environment they expect to persist, and a competitive shakeout among BEV players. He stated it's too early to make definitive decisions on segment presence, emphasizing flexibility. Regarding the product pipeline, Kallenius assured that new technologies like MB.OS will be proliferated across both ICE and BEV models to ensure a coherent, premium customer offering. CFO Harald Wilhelm added that while investments are at a peak in '24-'25, they are expected to decline post-2026 due to smart engineering and modularity.