Shares in the Netherlands-domiciled group tumbled roughly 15% in trading in Europe, and were set for a similarly rough opening in U.S. trading, after the company informed investors it will badly miss its targets of both a underlying operating profit margin in the double-digits and positive net cash flow in its core manufacturing business.

“Competitive dynamics have intensified due to both rising industry supply, as well as increased Chinese competition,” it said in a statement.

Now it estimates its margin to range somewhere between 5.5% and 7.0%, with the bulk of that resulting from flushing out bloated stocks of slow-moving cars and trucks in the U.S. with the help of incentives and rebates. It now plans to move forward its inventory reduction plan to ensure there are no more than 330,000 vehicles at dealers by the end of his year, from a prior target of sometime during the first quarter of 2025.

Meanwhile, its industrial operations—which exclude, for example, auto financing—are now set to burn between €5 billion and €10 billion ($5.6-$11.2 billion) this year. This is an eye-watering correction given it had reaffirmed it would generate cash as recently as late July.

In a note to clients on Monday, Stellantis bull UBS responded to the news by placing its ‘buy’ rating under review. The company’s shares have shed a third of their value in the past three months.

“The magnitude surprises and is higher than the warnings seen so far from the German OEMs,” it wrote, using an industry term for carmakers.

Industry’s 2nd profit warning in as many business days

The timing couldn’t be worse for its chief executive, either. Once celebrated as the best manager the legacy industry has to offer, CEO Carlos Tavares is now fighting for his job. 

Earlier this month, Stellantis’ U.S. dealers penned a scathing rebuke that placed the blame for bloated U.S. inventories solely on his leadership. Just last week the carmaker’s board followed up by implying it may not extend the contract of the still youthful 66-year-old and had initiated a search for a potential successor for when his contract expires at the start of 2026.

It’s a dramatic fall for the Carlos Ghosn protégé at Nissan. Taking over the ailing Peugeot Citroen a decade ago, the native Portuguese built the French group into the world’s fifth largest carmaker through savvy dealmaking and a ruthless focus on efficiency. 

The profit warning from Stellantis is the second in the auto industry in recent days. On Friday, Volkswagen Group revised its guidance lower, having already done so in July as well. Its CEO too is facing mounting pressure to relinquish his dual role as head of the group and its separately-listed brand Porsche — which, somewhat unusually, is worth more than the parent.

China: from an El Dorado to a competitive threat

As a result, three of Germany’s four blue chip carmakers have cut their guidance this month alone. It’s furthermore no coincidence that China is responsible for much of the current misery. 

For well over a decade, the world’s largest car market was an El Dorado for western carmakers. The rapidly industrializing country with over 1 billion inhabitants featured enormous growth rates and a preference for more lucrative models like large sedans and SUVs—and it lacked any serious domestic competitors. 

Now, China’s economy is in the doldrums and western brands—including even Tesla—must either offer steep discounts to eke out gains or watch their share of the market dwindle.

Not only are western brands no longer able to count on China for profits, it’s actually become a threat since emerging carmakers like BYD, the nation’s largest, and Volvo owner Geely have begun to probe deep into export markets including Europe and Latin America.

Stellantis, which did not respond to a request from Fortune for comment, will provide a quarterly update on car sales and revenue on Oct. 31.