MILAN (AP) — Carmaker Stellantis, the world’s fourth largest carmaker, slashed its earnings forecast on Monday, citing investments to turn around its U.S. operations amid a wider industry slump and increased Chinese competition.
Stellantis said it was accelerating efforts to turn around North America, including bringing dealer inventory levels to no more than 300,000 vehicles by the end of the year, instead of the first quarter of 2025 as previously planned.
The action is in the back of a decrease in shipments of 200,000 vehicles in the second half of this year compared with a year earlier, twice as many as the company had forecast. The company will offer higher incentives on 2024 and older models.
In its profit warning, Stellantis said it expected to finish the year with a negative cash flow of 5 billion euros to 10 billion euros, ($5.6 billion to $11.2 billion) instead of positive.
The carmaker, which was created in 2021 from the merger of PSA Peugeot with Fiat Chrysler Automobiles, also dropped its operating profit margin guidance to 5.5% to 7.0%, instead of double digits.
Stellantis shares were down 14.45%, trading on midday Monday in Milan at 12.45 euros.
The struggling maker of Jeep and Ram is looking for a new CEO to succeed Carlos Taveres, who is under fire from U.S. dealers and the United Auto Workers union after a dismal first-half financial performance. The company has portrayed the search as a normal leadership succession plan.
UAW leadership met last week to review contract violations and what they called illegal behavior by Stellantis. UAW President Shawn Fain advised Stellantis in a letter that the union is moving toward a strike. An autoworkers' strike last year cost the company 3 billion euros ($3.2 billion) in revenues.
Stellantis is also under pressure in Italy, home to one of the main shareholders, due to production cuts. Autoworkers announced a one-day strike on Oct. 18.
The company reported that first-half net profits were down 48% compared with the same period last year. First-half sales in the United States were down nearly 16%, even though overall new vehicle sales rose 2.4%.
FILE - Stellantis CEO Carlos Tavares speaks during a news conference following a meeting with unions, March 31, 2022, in Turin, Italy. (Fabio Ferrari/LaPresse via AP, File)
Fernando Uliano of Fim Cisl union, left, Michele De Palma of Fiom Cgil union, centre, and Rocco Palombella of Uilm union pose after announcing the mobilization of Stellantis workers and the entire automotive supply chain, in Rome, Tuesday, Sept. 24, 2024. (Roberto Monaldo/LaPresse via AP)
FILE - A Stellantis logo is shown at the North American International Auto Show in Detroit, Sept. 13, 2023. (AP Photo/Paul Sancya, File)
A stretch of aqueduct that supplies about half of New York City's water is being shut down through the winter as part of a $2 billion project to address massive leaks beneath the Hudson River.
The temporary shutdown of the Delaware Aqueduct in upstate New York has been in the works for years, with officials steadily boosting capacity from other parts of the city's sprawling 19-reservoir system. Water will flow uninterrupted from city faucets after the shutdown begins this week, officials said, though its famously crisp taste might be affected as other sources are tapped into more heavily.
“The water will always be there,” Paul Rush, deputy commissioner for the city’s Department of Environmental Protection. “We’re going to be changing the mix of water that consumers get.”
The Delaware Aqueduct is the longest tunnel in the world and carries water for 85 miles (137 kilometers) from four reservoirs in the Catskill region to other reservoirs in the city's northern suburbs. Operating since 1944, it provides roughly half the 1.1 billion gallons (4.2 billion liters) a day used by more than 8 million New York City residents. The system also serves some upstate municipalities.
But the aqueduct leaks up to 35 million gallons (132 million liters) of water a day, nearly all of it from a section far below the Hudson River.
The profuse leakage has been known about for decades, but city officials faced a quandary: They could not take the critical aqueduct offline for years to repair the tunnel. So instead, they began constructing a parallel 2.5-mile (4-kilometer) bypass tunnel under the river about a decade ago.
The new tunnel will be connected during the shutdown, which is expected to last up to eight months. More than 40 miles (64 kilometers) of the aqueduct running down from the four upstate reservoirs will be out of service during that time, though a section closer to the city will remain in use.
Other leaks farther north in the aqueduct also will be repaired in the coming months.
Rush said the work was timed to avoid summer months, when demand is higher. The city also has spent years making improvements to other parts of the system, some of which are more than 100 years old.
“There’s a lot of work done thinking about where the alternate supply would come from,” Rush said.
Capacity has been increased for the complementary Catskill Aqueduct, and more drinking water will come from the dozen reservoirs and three lakes of the Croton Watershed in the city's northern suburbs.
The heavier reliance on those suburban reservoirs could affect the taste of water due to a higher presence of minerals and algae in the Croton system, according to city officials.
“While some residents may notice a temporary, subtle difference in taste or aroma during the repairs, changes in taste don’t mean something is wrong with the water," DEP Commissioner Rohit Aggarwala said in a prepared statement. "Just like different brands of bottled water taste a bit different, so do our different reservoirs.”
FILE - Tunnel workers push equipment up a rail track to a machine boring a 2.5-mile bypass tunnel for the Delaware Aqueduct in Marlboro, N.Y., May 16, 2018. (AP Photo/Julie Jacobson, File)
