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STLA Stellantis

Participants
Andrea Bandinelli Investor Relations
Carlos Tavares Group Chief Executive Officer
Richard Palmer Group Chief Financial Officer
Philippe Houchois Jefferies
George Galliers Goldman Sachs
Thomas Besson Kepler Cheuvreux
Anna Gross The Financial Times
Jose Asumendi JP Morgan
Martino De Ambroggi Equita
Patrick Hummel UBS
Charles Coldicott Redburn
Call transcript
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Operator

[Technical difficulty] results for First Half 2021.

For your information, today's conference is being recorded. At this time, I would like to turn the call over to Andrea Bandinelli, in-charge of Stellantis' Investor Relations. Mr. Bandinelli, please go ahead, sir.

Andrea Bandinelli

welcome first joining half and we today Courtney Stellantis review XXXX you, to us everyone as Thank results. Investors' was Earlier this today, under release call for Stellantis's the posted as well website. the as related presentation section of material Group press by; is Group's Executive the Tavares, the Financial Officer. Today, Officer; hosted Group's Richard and our Carlos call Palmer, Chief Chief both After Mr. and Tavares Mr. Palmer present, they will be available to answer questions.

during mentioned the want to statement Page forward-looking will the might customary, language. make that any risks Harbor point statements to the by subject uncertainties that I today's out begin, included are we X in presentation. Before Safe of call and call And, governed we on be today's as

to I Tavares, Stellantis. CEO like of hand Now, would over Carlos to

Carlos Tavares

results Ladies announcement and welcome. Stellantis session. to gentlemen, Welcome this XXXX financial HX

Richard and be and to interest delighted, value are and We with thank for please myself people and take would care. in I I your that that your Palmer busy we well today know highly you you are time. to and like trust families your Stellantis. are you you We

say started. to we that were a revenues. is we forma to XX.X% improvement our of we It's XX% least record of had clear of on a Stellantis net XXXX. profitability could achieve the margin. pro basis, strong say operating adjusted On income able get HX also a Let's start that It have delivered

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Richard Palmer

Carlos. to Thanks, everybody. Good day

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margins flow HX. positive result, were half. industrial cash Page for for free show On the XX, the a As we

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marketplace. more region to are are XX the turn also North manage Dealer and transmitted more day vehicles efficiently. of facilitating historic units, is most customers. our status pricing and June. at This two-thirds we levels industrial full to The lows, of we about cash and America, sales be on and inventories. more down free of days to also from review US of pricing a coverage levels and Inventories retail with efficient has Page as mix inventories dealers into we reduced On America create March stock reduction the where to has of at further final dealer of expect are reduction. flow XXX,XXX partners the times discipline a dealer quickly Group been actions supporting significant inventory sales channel the to flow the continues be end work As reduced positive. the inventory result, North our vehicle dealer dealer distribution which, with was new year XX, improving

last of Page Moving XX. financial page to the the on section,

X% we outlook the to by full Our unchanged in region XX% to plus have from the QX outlooks of exception due retail with in particular. updated demand, strength from year the US our North America, industry remains where plus substantially update,

year. I income that and lockdowns guidance in also deterioration year no margin strong full further in United This operating performance are impact purchase significant earlier. policies further regards semiconductor As adjusted accounting the no guidance, accounting changes for to and XX% supply, the our our guidance now mentioned COVID-related and around of includes HX, the the raising we after States. This in assumed in Europe guidance

to you, Now, Thank I back hand everybody. Carlos. will

Carlos Tavares

Richard, thank presentation. you this Well, thank you, for very focused

top Before we to move with from would coming team to that the Stellantis. is executive I output the like some our Q&A, share of in you

this and what evaluation of company. company, know, you we And to a working still is this old, clarify people company. This it should top our but with under have to for people, our seven values be like you is been the what leadership of still the baby share months company our purpose would the our I team is with stage. at with As noble

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So we This be team. this sharing purpose leadership it with I share years? what to to the so what presentation of values what mindset? all, today to we talented next are that things lot would going governance and confidence lot great like I was opportunity four or raw you, and supply materials, of And with the here. opportunity set over headwinds, middle are you we values, purposes, health a lot of is chaos, of submitting ways, organization, have chaos, our chaotic noble is our each first regulatory that would good their with new of company of that to have in related challenges with are should the of new conclude been think every situations, this will have and a I'm very pressure do thought will employee we by a tremendous they been new understand a this business semiconductors, that HX, the in terms this a my you eventually Where we confident to with that But thank a few doing to lot you with feedback. be Stellantis, by our facing I selected up people noble those management top new we now chaos, Stellantis, adjust things. geopolitical take in chaos. have to like modify get

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but on our for Services, are We up can profitability come we to are now out the as a both which setting of grow strategy good on which at our means, a a to to also company, BEV we you we news. the against growing same more that market And as the all to very the on of are software strategy, Mobility division. factor money the also strong growing make and back nice some and we'll is side, companies software differentiation you this very side, about on also are this new see and speed time electrification which can see up is revenue as number this significantly you differentiator full other And you see, coming are you quarter. in we is perhaps tell in is the slide, the by the lines, offers business able full

to that's to I I like what Q&A, hand wanted over to from conclude. for And your here, you would please. So

Operator

the Q&A Philippe from of Thank begin. our [Operator And Instructions] question comes now line go you. session ahead. in will The Jefferies. calling from first Houchois Please

Philippe Houchois

inventory. Europe, just of because the was afternoon. sense see is you European get and It's we're Europe. Yeah, more constraints lack question trying clear in on the of sales below of on recovery running the what sorry not I Can the about to I in Good still hear source levels. have general XX% XXXX now? that is me your was this. US yes. Hi, I'm We

this? comment which that your And in as context as well, renegotiate you contracts to cancel may on also, you If all dealer them. recently, can

vision in Stellantis, be ability least mean your if to what of you Thank you. for is to you the how it's the of selling, towards what you direct a at future more wondering and like you Just change. evolving, vision But tell could look the should maybe do this of less Stellantis? Europe see in room what the US

Carlos Tavares

the that have Well, for questions you two you you. raised. Thank thank

way, something arbitrate we regions. all, the First between different This to way the of a down supply by doing global of the company. perfectly able as are break we semiconductors managing the so we and And therefore, that something company managing can means is the are we of best we have can in that we be, is future. in been doing, This protect the need we our business, way are that, supply the which this if parts shortage do. the

eye solidarity their of the best way and coordinated not is the is what to So keeping and part in a in business And the Europe the with level they together I'm Stellantis a regional and there other discuss spontaneous maximize way between of inventories. see Europe way, the managed possible Europe on a opportunities. the to is standalone regions. is By global an is COOs, very proactive meet they position.

cars inventories dealer are in as more dealer inventory. the absorbing quite course, Of seen, XXX,XXX cars they the But as limited, on are are the in than side have have you produced network. because the OEM we we

there our by of customers dealer inventory. cars still So be to a is lot registered the in

that Of on is not semiconductor would And visibility the we rightly course, my course, supply so. have people improve. like of And and more, the we great. have to

weeks, visibility that this peers get to to bad. supply not good we the all few telling it's expect the it worse. on fair not think also over to my do is have say very is you say the I that been that, it But last

but improvement to we expect some QX expect to see difficult, QX. be We from

are if mentioned This are in the than right we XXXX, that new to So And path. expect for overall, the as on be we it is the case, HX. guidance then, what was is worse we not seeing. HX

ongoing We suppliers. have of many discussions with lot a now

the the avoid collaboratively that make a a praise front to day. table team some It's of in foresee here you great on like strong out forward. that the also that working on alternatives and to We have put to that working managers, shortages I the a what XX/X find can validate team, very very sure we moving strong would are of we purchasing should we by engineers, great solutions alternative

I So this is say working is still that that we'll semiconductor think the able support visibility supply forward. the poor. quite quite on industry must to automotive the be that well. we moving in have Better and better, and But I

last few comments the that's I from carmaker away that from have hearing think what over that been CEOs the take you from you weeks. all the can

it terms dealer And opportunities. of contract, is be. to clarify now say will bringing us and the fair the clear dealers to industry of that been automotive for In what the asking future challenges electrification while have that is is new quite new a it our

a is, may it time, let's and build it's at to a is our with be the what direct from going request. very it the and now. intended. them. answer may constructive we sales. are let's fair to that It in, very them be together. discuss to I think more It frame same everybody, tell give And are are the by up in under and then is that constraints in distribution get, the be to that putting was is I co-construct Europe, I legal the we to can ourselves and pre-notice a and will discussions new it well model, way trigger which open us having reports the be what discussion on operating, that of This right to And to the best kind legal you expected productive discussion well very

because care business is moving will the I course, day distribution. book out why that, they mature that automobile take that mature world, tool think order are now. something is of by discussing to are of to right is moving learned to of change, terms way, been this we of freedom they us the mobility. are freedom This there business new our lockdowns a understand is value mobility is we protect a customers. we people, need new has to of reality. a They people, are And, of something world that forward, exactly is their growing the This fantastic mobility. that understand dealers our our very lesson needs in dealers be our a for very reason understand sharply. people of needs each the different a of And are your of big to completely this protect be asking us the is to the the to increasing By freedom adapted that what that

retailing we So the are is products, it can sales, be direct ways be it a can them. distribution with different what discussing of different model. maybe This

of weeks. flexible positive this mind And to in think them And I take them discussion. future. dealer the us only discussion, where minded appropriate open did and you. open to hesitate appropriate this so we the for are in I of it's associations. At our mind is see coming have, contribution This let's reason opportunity most them from find of open global this up. models way interest would constraint to the to this and Thank to of this good best far, all opportunity and give in the positive their we this how few today. legal we giving And that have are next distribution all is well pre-notice regardless we the can stage, the the why this conclude very in And brand, That's like for discussion. timing the to see us feedback discussion thank very the congratulate intended to this for we things not

go Let's question. the to next

Philippe Houchois

Thank you.

Operator

of The from next in line comes question ahead. Galliers calling the Goldman from George Sachs. Please go

George Galliers

Yes, thank you my for taking question.

guide. a cash you only suggest of billion something is flow. it in billion the I region to year I about XX% the apply operating full wanted So If as [technical EUR the a flow. cash really then capital of about X.X would don't a X billion incremental we income, the half, of you the leave EUR year, X.X the more about and take EUR for free us it flow CMD taxes, of should billion capital cash But is it in the year? we EUR X.X if to around X.X And in to did charges mentioned margin, percentage this learn if for next allocation think percent but and When deduct free to year. how implied the know difficulty], cash policy focus working thinking yes, financial cash we'll EUR I'd capital allocation I think the if billion XX%. flow, full first you to on you. EUR the we same free the the for would ex-provisions And billion realize right ballpark? Thank X it and we have flow your at the

Carlos Tavares

I for Well, and make to comments. would more thank floor the you, will give just your a technical George I to two answer question. Richard

better First of than to because today. is tomorrow are like I'd optimistic you an to future man I the see like and as with optimistic being discuss it all, people,

related we highly in efficiency keep spending. So, using long-term. company diversity in premium, X% and the to way to around way planning manage we by consistent And intend We strategy right way that, are one. continue two product related our in and going welcome this effectiveness number and believe that, competitiveness spend I turnover. terms effectiveness think while way CapEx capital we those our in the of more against of is money, club. is we the efficiency and the the that are manage the being is we it's allocation, of that our R&D capital R&D to around XX% to we This of peers. and complexity, now we the do of our we CapEx the have think And XX% we the That's to can spending our we than believe it Point you with company, related and mind that, to we can protecting peers. believe and premium keep part number mid the to full be XX% of DNA terms point competitive I because completely X% can against protect turnover our

Now I question, hand to working cap over to cash free like to would flow Richard. and your

Richard Palmer

Carlos. you, Thank

think, So to George, job. math, I pessimist part I know, of in little two, but sounds of you think the a that's I'm optimistic terms your the too, me of obviously, it so the

that sheet? within second frankly need a events for about discrete quarter. So, lack year second I think to So, problem the beginning first although we half, profile that flow. supply be that to semiconductors strong, full some there half think Malaysia others second to And work the good the obviously, we the and fact half. positive unknown be feel so were HX. of with should obviously. is, obviously we chain, of the expect coming And this visibility, to the does into the semiconductor out to continues be in the how we not where caveat And impact get us half cash how a frankly, worse, I may that's to through pretty get big balance

So, what half to about precise will you it's very be second volumes be. difficult know,

I I little positive, think for now, think than on our cash is flow it being going better saying with stick be we'll a to be So that. we're prudent But bit could positive.

to distribution regards line of dividends, in we exercise know, the a industry, regard to we have part think, that capital As planning with will be companies are all spend back with have Clearly, challenges sheet, XX technology have balance need the lots two money EUR the standards. we coming, capital billion of all Carlos, allocation, strategic that on policy sort as a to sort practice shareholders we're with I'd our aware prior which allocation. of we you we come of will think strong is, of, go as and liquidity, I the with of we in of about I'm places have for to terms how sure you that

that capital will generate of number. us. is substantial once the semiconductors cash no that with the So we we'll flow, enough stabilize you I know, I'm longer sure And impact believe for have volume company

that yourselves. we forward. dividend the flow but have strategic with then don't to the with and So you need around pretty then I about policy, And confident the cash discussions preempt going know, plan the Board to

Carlos Tavares

Is there question? a

Operator

in from question from ahead. comes The Kepler Besson line calling next go Thomas Please the Cheuvreux. of

Thomas Besson

you Besson, possible? Thank sure lot for A see like record reaching don't to you that in margins I'd on to baby first Cheuvreux. want Thomas of already the very to reach much. line you Kepler to months big HX of follow-up You company. managed companies that your happen. appear margins that I'm be HX.

the us probably your reasons rising, like from that profile whether to believe your believe pricing synergies to are merger? terms of with should one to I'd lower and environment. And as any looking am HX be otherwise for intention have right that arrival in margins Peugeot bit to very I HX check is there Stellantis than the to the a a you. of like strong Thank well of So

Carlos Tavares

gorilla pointed the semiconductor you is strong the the in That's the I big starting Well, big synergies. are gorilla. with as very Thomas, room you that we out, supply. told

semiconductor must be some of tailwind. the of The the measurement that magnitude that all is this great. of that, not That's the a have So we why keep the from problem kind to headwind we to topic. is attention need coming

run in in fixed discipline, are the be to in disciplined as much continue to going discipline, costs way on of terms we strong to continue the terms of on to discipline, put costs. operations variable costs, - terms in inventory we power our of very on going pricing are as pressure We distribution

that believe we face continue headwinds. are that to do can there to things So we

business. things own and is This the do bigger Now, the possibility that company and of forward. materialize, with same We the enhance engines need at the company to a give autonomy have the to of needs strong this strong each his will enjoy region we'll now all all speed regions, moving at breathe the see. which and to to time,

is but we to reporting to I'm do. planned. the and starting has all execution, now that's amount tailwind been not So what quite about which is to are it's forecast only executed, what going good, not look The synergy is you clearly the what

raw win inflation headwind of there in or there, still uncertain. material additional lockdown measurement the the Just very is and part, still cost is the any executed semiconductor in

because there of a may in hesitation world see, of of you in the Delta lot the is see you that around lockdowns, terms As variant. going

was to able if able not doing future. with the you predict I possibly So else, future the something predict I'm but with to

we that So with that headwinds. is motion, exactly statistically this thing as we right doing can putting we we motion That's But now. would semiconductor we sure in can be I be excessively where put it tailwinds will than are the to the the possibly in HX. the that with also make and what as is, in are HX tailwinds to only can overcome Richard many consider prudent worse do,

HX. to the saying supply And have have United great team go to So that decision even we the a materialize, sometimes tough. alternative will have reason semiconductor looking in And not appearing around we an that kind It's risks made in for care or made the engineering this and are a be and I really very environment they being employees and I'm alternative on imposed would sincere of And to solutions because have that like consider my very later appreciation more taking automotive really, why will here warm to the than hurdle. current I decision before and are industry. a that But this, we and you of as the the solution worse I see, it's you for already in Europe quite is people, is Stellantis it's convey States, hard. the notice surprising. in nobody see, my interesting keep the the pressure nobody of working stress to

caring pressure safe, day pressure in people growing the is meet. citizens. by people And in nobody is put and are new on the work bring industry that stress the to Europe. are clean And to objectives solutions about million the automotive those with the expected that that of the trying and XX to our have is We great affordable mobility we all

way being all in little work possibly the North the for So pressure. the should this to and feel they and of in pressure should do we is Europe, about thinking America, it support resist role number part employees a that people, which the we that, XX our automotive would also of And these consideration be and on and put part situation we and I this significant in kind is have the things cohesiveness in of of people course, million Latin industry they thinking, accommodate and we bit that. our to this also need we we same stepping to number back protect people company. and is also no to around my with protect this make A of that the is sure that number would same America. think our of And that that think

semiconductor your give today, I answer motion we And expecting worse sorry, to question, will That's have supply in can. as and are Thomas you we put tailwinds where more. that in things a So as get we few, we many will not the cannot HX. on

Thomas Besson

very much. you Thank

Operator

the The Times. of The line from calling comes from Anna Gross Financial go next question Please ahead. in

Anna Gross

of wanted I question shortage chip Carlos does there. hear supply competitors prioritizing the some you I like that of for hope Hi, it and its some Stellantis follows you, can have you, profitable Richard. as on to from and by have cars ask How more me. Thank that of Volkswagen? the Thomas's. of a thank its faced kind chip range

Carlos Tavares

once at this the how efficient per regions the And per the are of as looking and ensure as in or now. at. look at compliance then, we margins as margins, have production down COX is Well, terms the protecting we we that compliant be. the is we supply we should very unit the we the compliance looking to we should simply they planning proceed compliance what that be they by region, looking way. in That's are right a course, unit break of try And factor are the most of at

basis we basic one is the nothing number silver an generate those semiconductors. compliance and to and is So in are two and Nothing, That's very proceed. how allocating amount when bullet. profit It's unit potential there per is very - margins simple. we number no

Anna Gross

you, Got a thanks lot.

Operator

of in next ahead. line from from go calling The question Jose the comes Asumendi JP Please Morgan.

Jose Asumendi

have neutralize better Morgan. the unleash use Thank of start of you first flow. JP come any wanted the the cash? on Asumendi, elaborate on better give give of year. strong bit little on - industrial CapEx, you. are could hear us levers of of Jose months how footprint, to examples are CapEx outflow. How what you you to back and to the representing on of the a you've D&A the resources? congratulations and out? the And And key Carlos, cash shifts quite you, - cash what some substantial around to you're details Carlos how machine, many the managing D&A know, some love got you I'd also, you're make of lot to the six could I of Richard, taken you could how to if levers if Italian make to the managing use still examples right and a

Carlos Tavares

a ourselves will discuss which found is over Well, first to proper Italy cash thank Jose. that, technical then a the I status is us. we very is not second near flow, is I which free happen in of On quo, to all Richard do on that we partners, the hand on quite answer the to The obvious to way trouble. Italy. the question the we with have one. them showing future the move, you in union for more then, Italy, going try good put you, them automotive showing and for if And we will what that's one know industry news to protect our in and big if

in meet we to we problem, a put against respectful and this then direction, and the the conventional between is of absorb And then, is fast So, XX% come have if and now with cost around just we the the electrification, all which XXXX. objectives, at COX up looking looking to we electrification XX% deep know that we mobility we very two and trouble. fact had objectives, which we don't in at if those in ourselves strong explain the simple are what way, another go

explained As Day. to you I the on EV

in that manufacturing the electrification, the we the distribution in but contribution that monozukuri And a a that on a specific absorption environment. just of to And plan why all then that. the this from coming have operate objectives fully electrified will direction. is moving the EV through the do meeting from Day understands everybody agreements XXXX jeopardy could must. and XX the creating in on we not union directions, costs come at lot stake Italy, of we simply try we now protect operations. means states is means company motion decisions And what double-digit Italian explaining happen in don't is the So through the scientific with COX to we up which which not is of if additional if positive be COX which we quo, of status a be put can a reason we of what in just in only committed also respectfully with XX% by our what of sorts course, move, only of would and to And an from performance direction, total them, the we partners call our done

that the highly As demonstrating are the we course, of highly also moving you profitable. addition Citroen AOI and Italy, is now, fact saw, in in X.X% Opel/Vauxhall profitable, of Europe margin now is DS Peugeot, that to is and

which a company, is then, if everybody that we there is is trying right It's in company trouble. do a do management direction, the protect So moving reality. now the because company such just new think change industry. and people the status of not we easy, are in the the will is fast it, its But don't understand supporting quo. the no best be And I the in adapt to to company to not

the high with of Italian our quality is government high. our the is quite quality dialogue and Italian also the So the with quite dialogue unions of

going of So the we of led in way, Europe. we the their the some were merit of By free gigafactory we making today and to are done probably let which which on able have to good that this have cash understanding over where in for our Italy, is the most This me fair hand will our question. future, announcements flow constructive hopefully we be solutions, what's teams, and will there through share other sure Italian and positive discussions. which is also bring and support to by Jose, on Richard the announcement

Richard Palmer

notwithstanding in Well, cash know, other know, I volume, the we you terms levers, you one, the general, cash the Thanks, as I half, of know, of are for mean, the Carlos. significant impacts be you efficiency working are And challenges as think, flow in continue efficient as of we Carlos R&D. terms so, to clearly and we to that metric. OEM need the very on CapEx on the the of And mentioned, technology. in most

on I the execution execution, know, R&D synergies. five and CapEx around think, secondly, through that or the the from will be have of comes by synergy we year supported plan, XX% synergies you our four

cash to And help And is so margins, the end all cost that will the going our lower on of to leads on across continue support parts focus us fundamentally generation. the number clearly our the to And synergies of side industry. that which maintain of business. improve the then the other to part to obviously ability that

seven their service, So clearly in year areas, very And cars even is I think in then part the Stellantis which improving and new something used and cars, business of is that parts us last so the other new months. clearly are industrial performance with volatility caused last that's the terms hurt in bit inventory the inventory did semiconductor by on in which process, the there. is, side, clearly because a us stop-go or hurt supply

have process, stable to a opportunities on improve I planning industrial there. capital think the goes to working So we'll side and back execution able as we more be improve our to

So all I think we're working of these. on

our distribution indicative distribution model, of talked the which us business, of we've and distribution how the maybe seeing is some we dealers obviously I And this lastly, by at reduced extent now we towards for a as then, stock, we're which reducing. leaner model. seen distribution So go of caused about with shortages, significantly, rate turn to showing are next been of the the way to - The or it's the sales managing step think forward how earlier, built-to-stock et sorry, as built-to-order look types we've and versus going turnover improved dealer of has to first, but cetera. that has semiconductor COVID is, clearly then do we'd go costs managing because in distribution more other terms and direct like forward, the

our those things the all improve conversion to obviously, the future. cash on So, in table,

Carlos Tavares

you, Thank Richard.

question. Next

Jose Asumendi

Thank you.

Carlos Tavares

Jose. you, Thank

Operator

De The the from calling Equita. ahead. next Martino question in line Ambroggi Please from of comes go

Martino De Ambroggi

good look on Thank with net everybody. the XX, good morning, present at price income you is content. My you. present afternoon, Slide a If adjusted together you where focus I prices. your operating bridge, And

due net So a the for that different believe of assuming will of for norm is see is do the your for first Do the XX% the long second used that is expect to part a several you at return in view? ability, question much back positive years to pressure to price is right market - block how I of expect How the portfolio, do point the from such And or environment? we part when Carlos, in Am to sector? last environment the to And usual least prices your regardless the you. Richard. Thank market from of there's you price? these for the comes you life? normal what

Carlos Tavares

great thank Well, This is questions. two you.

Let after one. second Richard the answer me to I hand over

lot unbalance I coming between increases, a all, coming. of I certain and number demand only believe components. that inflation see on raw from First a from also not number a inflation certain there cost of is material of but of supply

to clear our we make positioning so consideration there of But no the the improve appeal through and a it. and pricing there the and best the is have our inflation to the our unit then pricing is we at be of communications gap the are market, we benchmark, the that power a clarity because there if margins, we to when that digest. will level make things, which through an that the inflationary to sure of the products, put pressures, into which per gap we the believe I some all brand able through benchmark are of So when is, final means, we and sure people, of will take of against be intention, market our some industry, will have be ourselves will others are of the the opportunity we market, consumer, discipline is benchmark, the and passed setting them we two

seen case you submitted In be all to are have from So or from the components materials the everywhere cases, raw the same more not or But through we scarce electrification. still thing as we it. either presentation. some have good It's from coming that, pressures room. inflationary the is

markets. the IPO. company the and have we question our politicians. very And a and of mobility a used consequence is How IPO very It's the on was Which increase? decisions question the That's the two the react so a the One that. profitability going the that years will So trying Aramis citizens improving individual citizens volumes and seen me. efficient care of in good you democracy is cost democracy? then, how doing the question family major if mobility technology? second of are the And real a for our to a used for our increasing, way, a the in to I not of is, on increases, as issue made are also react see are leverage cost is going few if then, are to the we need be in in are car of business cost going car we because mobility the when questions. they to take is, for a electrified And to

is business that business that So is growing profitable. and

is democracies, the front. to but we for business accommodate And lifestyle that to actively the our can that as happen, fact part any that's ourselves And for company. surprised. consequence a as and limit expensive them that a direction. from made to have reason we of as the need for very breathing a far space, why and market also the too are happy the for the support sure mobility from if much our if the of manage as that more volatility keep become our working we think are course, we we which will make prepare need the of us we impacted. that, don't you which of be very, in that of may middle may societies understand a I IPO, would business rightsizing breakeven that used today of are would be we of That's breakeven to expensive, way size car company, are as give to managing in side of So have on we growth the that the the growing Aramis was imagine, we too starts of to the then, with. be point for the to the for that we the on the freedom and we of issue a class. mobility And that certain And And actively we problem be market point the

we over will I Richard today. for surprised OEMs question hand eventually where think on is before move. this I pricing. are by And that be other And to us would like to your

Richard Palmer

Yes, Martino for I mean, I you. don't have a number precise

to one it's you lower But on your priced these of we're is XX%, most large the is of majority know, know activity. working house you're groups point. aren't Whether it kitchen challenges sort some of XX%. But I yes. both the don't together through vast to You I think priced, that I'm is that confident the of of metrics these in all the same of exactly sides putting know.

Martino De Ambroggi

you. Thank Thank you.

Richard Palmer

you. Thank

Carlos Tavares

you. Thank

please. Next question,

Operator

calling from go comes from ahead. Hummel the of Please Patrick The UBS. line next question in

Patrick Hummel

much. the first the you've for synergies of Hi, question very Richard. you half Thank and My guidance year. reported the to the Carlos relates and

synergies You implementation number annualized that that reconfirm said, is X.X a four least a number as think I to like of in context billion billion second number? double like after get I bit to than that be maybe And that EUR billion? sounds or guidance, sure can just would wanted have your the to compliance make be HX? the EUR if to should which we just I Thank at share and do X.X first that done wanted you've for half. And year for X an me you in raw big first number more of if relates much two you. reduce the concerned for EUR a right least for time mat the as at the half how just number may, you you to cost ballpark this far can are full granular about seen expect I target, gave more a in you as quite and the So merger? year headwinds the of

Carlos Tavares

Well, thank you.

committed is of will highlight that First probably five X.X the billion your billion And against of that all, he to only. number Richard, fact we euros But synergies understanding of from would bring that, before kind four. XX% indeed we the we I most I of for like Richard would to year HX that over starting is very X full and correct. EUR year just sees strong. to commitment, What hand is have And comment from for are let EUR what Richard? the year. you

Richard Palmer

- on X.X billion the cost X.X side. said, includes Yeah. Patrick. EUR The the Thanks, Thanks, XXX billion HX, like and R&D is the Carlos. million the rest of EUR cash I EUR is and CapEx impact

going start D&A. we because then the and P&L We all we not yet, benefit first. it's R&D, production cash comes put So CapEx, and obviously, capitalize through into the

P&L come instantly. So to the that doesn't all

lumpy. then amount million it, I the the full year because to and the point, double about XXX the just is And CapEx EUR so wouldn't of P&L number, is impact the

So I it then million. included double it the full expect EUR half, second I number, HX And synergy to yes, wouldn't synergies the in to continue in are compliance and for think generate the year. in but XXX we more the was about costs

I think all answered your questions. I

Patrick Hummel

you. Thank

Richard Palmer

Thanks.

Patrick Hummel

mat headwinds you if mind? don't for raw HX, And

Richard Palmer

had million XXX EUR be Apologize. Yeah, the raw that expect we in I HX. HX. double of so to mat's in headwind, it

point potentially margin, worsening HX raw of So because we mat. X expect in of at

to compared we're slightly HX uncertainty So together lower with guidance that's semiconductors. doing in around obviously of the part the obviously, HX

Patrick Hummel

Thank you much. so

Richard Palmer

you. Thank

Carlos Tavares

you. Thank

Next question, please.

Operator

Redburn. next The go ahead. in you. from in of the from calling final and Coldicott comes question queue Thank Please the line Charles

Charles Coldicott

Can the out the coming in of just question. NAFTA. relative of maybe maybe ramped expect us level production it's Hi, want idea from doing NAFTA? impact of an you're an idea fully in Grand once of currently terms thanks of on overall up, the give you those for units margin Wagoneer to I taking The Warren Wagoneer my you profitability the ask and also and models of to

Carlos Tavares

early And, can bit Before products over ramp I profitable. their to will to somewhere one, Therefore, at Richard, that, hand tell are those this stage, course, is be book. still I talk number up. what order of little the a you in they it's highly prioritized about

a the before be And I But order up of think a that highly should profitable. we book. a course, adjusted book. extent to But But a numbers something of many bit going before the perhaps it's year. on forward. the more, couple little we are say is we what are certain produce we how on this have to course, that more going of of we precise that to this moving Richard ramp It's, visibility view a on order bit that, months we little protect clear lack can you a to I give we think wait matter. will visibility precise has

Richard Palmer

Yeah.

impact started get up the ramp more we is of in terms for in to QX. significant production the year, QX, In the

through So half year. the of the XX,XXX we'll first next year be XX,XXX then and it's, around for the up ramp for year, I we'll think

segment. to strong vehicle it Cherokee on in positions in, And don't ramping an be the volumes, clearly. semiconductors X-Row I which are I margins accretive sits those on our to type always assuming up think and We've very as also in. on of we clearly can volumes focused there's second the So from positive well, impact will to impact holds. segment team we're that to that our safe the competition create that that want But the price margins first the coming and a with types compared seen Grand margins on obviously together get now target say we're the for half, definitely half a vehicles of

Carlos Tavares

you, Thank Richard.

I was or misunderstand? final this the question think did I

Operator

the was questions. That final

it for remarks. hand concluding So across any I'll to yourself

Carlos Tavares

much. very Very you good. thank Well,

I thank all, of would like First you your all to thoughtful for questions.

are I your just to to not in moment would for always on thank company. Stellantis, questions you. to we progress thoughtful for a us know, questions with support you like As interest your and you, this like always based your quality trying the of discuss to only our rewarding course, for we of expect Stellantis fast, our would are for and operative, to still great tailwinds now I lot to face a very continue to keep is governance are we you people enthusiasm and create expressing baby, that deal headwinds. business proposals, with bottom-up a that in mind our that more moving that that, our way the to of of a is

our not course, the semiconductor of crystal will than peers have better no supply. what ball, Of with we in happen terms

of to that worse we in improve not would do are of quality of we from just our than Thank should and HX. And you we considering efficiency full are So HX respect doing we you see Thank soon. the been course, company. you effectiveness much. our there, it it very all has the And you in compliance, very in of and be people. for whatever this can and