Stellantis' Sochaux Restart: A Litmus Test for EV Ambitions and Leadership Transitions

The restart of Stellantis' Sochaux plant on June 7, 2025, after a week-long shutdown caused by a faulty Chinese stamping press, marks a pivotal moment for the automaker's operational resilience. The incident, which cost 1,000 cars per day and disrupted one of Europe's most critical manufacturing hubs, underscores the fragility of Stellantis' supply chain and the urgency of its leadership transition. Newly appointed CEO Antonio Filosa—set to assume the role on June 23—faces a high-stakes challenge: stabilizing production while accelerating the company's EV pivot. For investors, the Sochaux restart is not just a plant reboot but a test of Stellantis' ability to navigate semiconductor shortages, tariff wars, and the rise of Chinese EV competitors.

The Sochaux Plant Restart: A Microcosm of Stellantis' Challenges

The Sochaux plant, a historic symbol of the Peugeot brand, is central to Stellantis' European operations. Its recent shutdown—triggered by a breakdown in a 2020-era Chinese press—exposed vulnerabilities in both supply chain localization and equipment reliability. The plant's role in producing SUVs like the Peugeot 3008 and 5008, which rely on advanced body parts, highlights the interplay between manufacturing precision and EV readiness.

Yet the outage also reflects broader systemic risks. Stellantis' reliance on Chinese-made equipment and its struggle to localize production in the face of U.S. tariffs has forced costly shifts to North American plants. Meanwhile, competitors like BYD and NIO are gaining ground in Europe, where Stellantis' BEV sales lag behind industry leaders.

Semiconductor Partnerships: The Hidden Engine of EV Production

Stellantis' EV ambitions hinge on its semiconductor partnerships, which are critical to overcoming bottlenecks and securing supply chains. The automaker's collaboration with Infineon Technologies stands out:

• Smart Power Switches: Stellantis is adopting Infineon's PROFET™ technology to replace traditional fuses, simplifying wiring and enabling intelligent power management—a first among automakers.
• Silicon Carbide (SiC) Semiconductors: Infineon's SiC CoolSiC™ chips will standardize Stellantis' power modules, improving EV efficiency and reducing costs. By 2030, Infineon's Dresden-based 300-mm “Smart Power Fab” will ensure capacity for Stellantis' needs.
• AURIX™ Microcontrollers: These chips underpin Stellantis' STLA Brain zonal architecture, enabling software-defined vehicles—a key component of its Dare Forward 2030 plan.

The 50-50 joint venture with Foxconn (SiliconAuto) adds another layer: custom semiconductors tailored for ADAS, infotainment, and battery management systems. By 2026, this venture aims to reduce reliance on third-party suppliers and lower production costs—a strategic win as EVs increasingly depend on chip-driven innovation.

Filosa's Leadership: Can He Stabilize and Accelerate?

Filosa's track record—turning around Jeep's South American sales, cutting U.S. dealer inventory, and launching hit models like the Ram 1500 Ramcharger—suggests he understands operational and market dynamics. However, his path to CEO has faced pushback from French board members wary of his U.S.-centric focus and the Leapmotor partnership.

His priorities are clear:
1. Revitalize U.S. Sales: Returning retail orders to pre-pandemic levels hinges on launches like the Jeep Cherokee replacement and the Ram 1500.
2. Accelerate EVs: A $30 billion investment in electrification, including CATL's Spanish battery plant and partnerships with Factorial Energy for solid-state batteries, aims to close the gap with Tesla and BYD.
3. Margin Recovery: Stellantis' target of 8%+ margins by 2026 requires cost discipline and localization to counter tariff pressures.

Investment Considerations: Risks and Opportunities

Risks:
- Tariff Volatility: U.S. tariffs on European imports could force further production shifts, squeezing margins.
- Leadership Uncertainty: Until Filosa is confirmed post-June 23, governance risks linger.
- Competitive Threats: BYD's aggressive pricing and NIO's tech edge in Europe pose existential challenges.

Opportunities:
- EV Market Growth: Global EV demand is projected to hit 30% of auto sales by 2030, favoring players with scale and semiconductor partnerships.
- Margin Turnaround: If Filosa delivers on cost cuts and localization, margins could rebound sharply.
- Undervalued Stock: At current levels, Stellantis' shares trade at 6.5x EV/EBITDA—below peers like Ford (7.8x) and GM (8.2x)—offering upside if operational stability improves.

Conclusion: A High-Reward, High-Risk Gamble

Stellantis' Sochaux restart is a microcosm of its broader struggle: balancing legacy operations with EV innovation while navigating geopolitical and supply chain headwinds. Filosa's leadership is the linchpin—his ability to stabilize production, secure semiconductor supply, and outmaneuver Chinese rivals will determine whether Stellantis becomes an EV leader or a cautionary tale.

For investors, the stock presents a compelling contrarian bet. Buy if Filosa's June 23 confirmation sparks operational clarity and margin recovery. Avoid if supply chain bottlenecks persist or tariffs escalate. The restart of Sochaux is just the first test—what matters now is execution.