Operator: Thank you for your questions. And we have time for one last question today from Harald Hendrikse from Citi. Please go ahead.
Harald Hendrikse: Thank you. Can you hear me okay?
Natalie Knight: Yes. Thank you.
Harald Hendrikse: Thanks so much, Natalie. Great conference call. I don’t think I can remember a call, where we got quite so much color and yet then I have the cheap chat for more. On the margin guide specifically for the first half and maybe a little bit for the second half, but I just wanted to give you a chance to talk about the regions a little bit more. The inventory correction seems to be bigger in the U.S. than in the other regions. Should we expect after what was an incredible first half 2023, is that where really the biggest part of the margin normalization comes? Secondly, sorry, just on the macro, but you’ve mentioned a few times and a few of the other companies have mentioned the second half of the year is going to be better.
Unfortunately, I’ve been an analyst for 25 years and whenever I’ve heard that, I’ve always been a little bit scared of those statements. Can you just explain, where that macro improvement is going to come from and why you’re thinking that way? I would have thought you guys are the ones that really would manage the costs ahead of any macro assumption.
Natalie Knight: Maybe on that part first, as I said, it’s not a Stellantis call if we aren’t talking about cost and financial discipline. That’s obviously part of our recipe. When we look at those macro factors that are moving, I think we have seen timing on the interest rate push back a little vs, what our expectation would have been earlier in the year in terms of potential interest rate easing. When we look at our logistics, our outbound logistics improvement that we’re projecting, that definitely accelerates as we go into the second half. It’s I think something that is happening externally, but also something that we’re able to be part of driving that solution. I think there are pieces in terms of, what happens potentially on the political front, which there may be positives or negatives associated with that, but at the moment, we’re in a little bit of a wait and see position.
And so, there’s certainly potential that can come there. The other part just on the macro side that’s very positive from the industry side is, while I think we’ve got definitely the best product portfolio of things coming to market in the rest of the year, there are a lot of people out there with product stories that are coming in specific categories and this is a spot, where I do think that has an opportunity to lift the industry and consumer sentiment, as we move into the second half. On your comment about margin guidance in terms of how things are happening with the regions and specifically you asked about inventory, let’s make sure, it’s clear that, the biggest reduction in inventory in the first quarter came from Europe. That really is the spot where I think we probably had the biggest need in terms of that’s where you’ll see the most of our new products on the BEV and LEV side coming first.
A big congratulations to that team for driving that improvement. But you’re right, there were improvements in all of our regions except for the Middle East and Africa because we’ve got so much growth coming there. I think substantively in North America, there were very important improvements that happened. When you look at your comment about what does that mean for the margin guide by regions and why have we looked at this perhaps more conservatively than what people would have previously expected. I think we’re just looking at, what is the development in each of the regions that we’ve seen in the first quarter and we want to make sure that we’re not overly optimistic. That at Stellantis we put a real value on making sure that we guide to a range and a belief of what we think is very, very realistic.
And we’re very pragmatic about that. I believe while we have improvements coming in North America, I think that’s the spot. When we look at the first half, you will see declines in margin in several of the segments.
Harald Hendrikse: Yes. Fantastic color. Thank you so much.
Natalie Knight : Good, then I’ll take that as a last question and maybe it just gives me the opportunity to wrap things up a little bit from my side. I think it’s really important when we close out today that we just remember, we are in this transition period where we are getting ready to show you the true color of Stellantis as we bring new products to market where we have multi energy opportunities that’ll allow us to benefit from a cost side, from addressing the consumers in the best way and also showcasing our agility. I think, while there are things, we would love to have seen different and better in the first quarter, we are very proud of where we’re moving when it comes to market share on inventory. We think we’re doing things in the right way.
And although there are I wanted to make sure everybody had better clarity about what our results are likely to look like at the half year. You hear a clear commitment from us to maintaining our financial guidance for the year. We’re excited about the opportunities ahead of us and are really looking forward to speaking more with you in ‘24. The next opportunity is our Investor Day on June 13th. Thank you very much.
