Stellantis NV, the parent company of iconic brands such as Jeep and Ram, is reportedly preparing a substantial investment of approximately $10 billion in the United States. This strategic move signals a significant refocusing on the American market, which is deemed crucial for the company's profitability. Sources familiar with the plans suggest that this investment could be announced in the coming weeks, comprising a fresh commitment of about $5 billion, alongside a similar amount allocated earlier in the year.

These investments, slated to be disbursed over several years, are anticipated to revitalize various aspects of Stellantis's US operations. Potential areas for capital deployment include the reopening of plants, significant hiring initiatives, and the development of new models, particularly in states like Illinois and Michigan. The company aims to reclaim the past success of its Jeep brand and is exploring new investments in Dodge, which could lead to a new V8 muscle car, and possibly even the long-term prospects of the Chrysler brand. While discussions are ongoing, and specific projects and amounts may evolve, the intent behind this financial injection is clear.

The shift in strategy is largely attributed to Chief Executive Officer Antonio Filosa, who assumed the top leadership role in May. Filosa's mandate involves recalibrating investments across global regions. This marks a departure from the approach of former CEO Carlos Tavares, under whom Stellantis had aggressively moved production and engineering operations to lower-cost countries such as Mexico and prioritized heavy investments in Europe, a region characterized by weak car demand and low profitability following the group's formation in 2021.

A media representative for Stellantis confirmed that the CEO is leading a thorough evaluation of all future investments as part of preparations for the company’s strategy update and capital markets day next year. This initiative by Stellantis aligns with a broader trend among various industries, where companies are announcing significant investment plans in the US economy. Such moves often serve to foster goodwill with political administrations and help mitigate the impact of potential tariffs. For instance, Hyundai Motor Group recently committed to increasing its US investment by $5 billion to $26 billion through 2028, and several major European pharmaceutical companies have also pledged billions in new spending.

Part of the investment could also fulfill a pledge made by Chairman John Elkann, who previously met with President Donald Trump to discuss American investments. This includes the manufacturing of a new midsize pickup vehicle at Stellantis's idled plant in Belvidere, Illinois, with a commitment to re-employ approximately 1,500 workers. Such a move could also serve to appease the United Auto Workers union, which has engaged in prior discussions with Stellantis regarding this matter.

Simultaneously, Stellantis has been actively lobbying the current administration to waive or soften a potential 25% tariff that could affect its medium-duty Ram pickups produced in Mexico. Filosa, an industry veteran from Fiat Chrysler Automobiles, faces the challenge of stabilizing a company that has experienced considerable market share losses in both the US and Europe due to past strategic missteps under Tavares. He is also tasked with navigating the repercussions of evolving tariff policies that are reshaping the global automotive landscape. Early indicators suggest some success, with a gain in third-quarter US deliveries contributing to renewed investor optimism.

Concurrently with its US refocus, Stellantis has begun curtailing certain European investments. This includes withdrawing support for a joint hydrogen-vehicle venture with Michelin and Forvia SE and considering the sale of its Free2move car-sharing business. The company also sought strategic advice from McKinsey & Co. regarding Maserati and Alfa Romeo, although it has consistently denied any plans to sell Maserati.

The heightened focus on the US market has sparked concerns among European unions, especially given Stellantis’s manufacturing overcapacity in the region. Like its competitors, Stellantis is grappling with excess production capacity amid the expansion of Chinese manufacturers, led by BYD Co., into the European market with competitively priced vehicles. The company has temporarily paused production at eight of its European plants due to lagging demand for models like the Alfa Romeo Tonale SUV and the Fiat Panda. Filosa is scheduled to meet with Italian labor union representatives on October 20, as worries about potential plant closings intensify, adding pressure on him to honor the ambitious production plan for Italy presented late last year.