Shareholders sue Stellantis for inflating its value
The automaker's management also drew criticism from the United Auto Workers, which accused the company's top management of enriching itself at the expense of its employees and customers, and of failing to honor agreements that ended last year's strikes.
Stellantis CEO Carlos Tavares
Bad news continues for Stellantis. A group of shareholders went to a New York federal court late this week to sue the company, accusing it of inflating its value by hiding weaknesses in the business.
In projected 2024 earnings, the company reportedly hid problems with its inventory, pricing, market share and expansion, Bloomberg Law reported. The automaker's true state was revealed for the plaintiffs last July 25, when it reported a 48% drop in net profit.
The shareholders are seeking damages for those who held shares of the multinational between February 15 and July 24 of this year.
Stellantis assured that the lawsuit "is without merit " and that they would defend themselves "vigorously", in a statement collected by Reuters.
"Something is rotten at Stellantis"
The complaint in New York coincides with a new onslaught by the United Auto Workers (UAW) union against the company.
In a video released Friday, UAW President Shawn Fain accused Stellantis of failing to honor agreements reached after last year's historic strike and of raising prices above the market price to the detriment of customers.
Fain singled out the automaker's CEO as the culprit: "Stellantis is in a race to the bottom, driving up prices while cutting staff so overseas executives like Carlos Tavares can have a bigger payday. America invested in Stellantis. Workers have invested in Stellantis. And consumers have invested in Stellantis."
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