Paris, France – Since the start of U.S. President Donald Trump’s trade war in April, the European auto industry has been under strain. On Monday, September 22, Stellantis, the French-Italian-American car manufacturer, dealt another blow by announcing the three-week closure of its Poissy factory, just outside Paris.
Beginning October 13, the factory’s 2,000 employees will be placed on partial unemployment or required to use paid leave as Stellantis seeks to “adapt its production rate to a difficult market in Europe,” the company told AFP.
Jean-Pierre Mercier, a member of the Solidaires union (SUD) which represents many of the factory’s workers, responded to the closure by saying he is “convinced” that “management is accelerating the plan to close the factory.”
The announcement comes after the alleged decision to partially close five other Stellantis factories in Europe: the sites in Eisenach, Germany; Zaragoza and Madrid, Spain; Tychy, Poland; and Pomigliano, Italy.
A bad year?
Multiple factors have contributed to Stellantis’ decision to close its Poissy factory, including a reported net loss of €2.3 billion ($2.7 billion USD) in the first quarter of 2025.
Following Carlos Tavares’ resignation as CEO in December 2024, Stellantis’ stock price fell by over 50% in the past year. Car sales are also down: in the first quarter, the company delivered 1.4 million vehicles, 7% less than for the same period in 2024.
Also in their first quarter this year, Stellantis absorbed a €300 million ($352 million USD) tariff impact, largely due to Trump’s trade measures. That figure represents an estimated 5% of the company’s projected €2.5 billion tariff burden for 2025.
While one in five of its vehicles is sold to American brands, such as Jeep, Ram, Dodge, and Chrysler, Stellantis manufactures more than half of the cars it sells in the U.S. within the country itself.
Thierry Mayer, an economist at Sciences Po university in Paris found that firms with a strong U.S. manufacturing presence are likely to benefit from President Trump’s duties, with Stellantis projected to increase its sales by around 100,000 units.
Leaving Europe behind
While the American market may be able to adapt to Trump’s tariff war and anti-electric vehicle policies, Europe poses a greater challenge for Stellantis. EU regulation stipulates that from 2035 onwards, all new cars coming onto the market must be CO2-free to ensure that the transport sector can become carbon neutral by 2050.
By the end of August 2025, petrol car registrations declined by 19.7% in Europe, with all major markets experiencing decreases. France experienced the steepest drop, with registrations plummeting by 33.5%.
Despite this shift in consumer behavior, Stellantis announced it would no longer pursue its target of producing only electric vehicles by 2030. The company also discontinued its hydrogen-powered vehicle program due to the lack of development prospects in the market.
Unlike Jean-Pierre Mercier, Poissy’s factory director Eric Hann remains optimistic. He stressed the integrality of the factory when he noted that Poissy is among the most efficient factories in France, and less expensive to operate than others in Germany and Italy although still more expensive than Spain, Poland or Serbia.
But, precisely for this reason, new CEO Antonio Filosa announced a $1.2 billion USD investment in Morocco in July aimed at doubling production by leveraging skilled but lower-cost labor, tax incentives, and supportive industrial policies.
Featured image:
Image: Stellantis announced a billion-dollar loss for the first half of 2025 back in July
Source: Heute.at
Creative Commons Licenses
