The boss of car-making giant Stellantis, Carlos Tavares, has quit with immediate result following a boardroom clash.

His abrupt exit from the business – which owns brands including Vauxhall, Jeep, Fiat, Peugeot and Chrysler – comes two months after Stellantis issued a gain warning.

Last week, the firm also announced plans to close its Vauxhall van-making factory in Luton, putting about 1,100 jobs at hazard.

Before his resignation, Mr Tavares was one of the most powerful people in the global motor industry.

In a statement announcing Mr Tavares’ departure, Henri de Castries, Stellantis’ elder independent director said: “Stellantis’ achievement since its creation has been rooted in a perfect alignment between the reference shareholders, the board and the chief executive.

“However, in recent weeks different views have emerged which have resulted in the board and the chief executive coming to today’s selection.”

Mr Tavares had a reputation as a ruthless expense-cutter.

He made his name at Renault, working with the colourful and controversial chief executive, Carlos Ghosn, before taking the top job at PSA throng.

At the period, the French throng was close to financial setback. He was credited with turning it around before orchestrating a combination with Fiat Chrysler to form Stellantis in 2021, creating a global giant.

“He was known for being able to turn around companies that were troubled,” Hans Greimel, Asia editor at Automotive information, told the BBC.

However, Mr Tavares’ position has been undermined recently by a dramatic fall in sales and profits at the business.

“Critics would declare he was just expense-cutting too much and delaying products and also hurting standard,” said Mr Greimel.

In September, Stellantis had issued a gain warning after it reported a sharp drop in sales in North America.

Dealers found themselves struggling to shift a glut of unsold vehicles, which customers simply didn’t desire to buy.

The business was criticised for producing too many cars of the incorrect type, failing to adjust to changing customer tastes and losing ground to more dynamic rivals.

Prof David Bailey from the Birmingham Business School, told the BBC’s Today programme that while there is “huge turmoil in the car industry generally” Stellantis has its own “particular problems”.

He said: “What’s really, really driving that, I ponder, is the circumstance in North America where they’ve had appalling results, a very dated product line-up, rising inventories and slipping trade distribute as a outcome of which all the stakeholders involved – suppliers, dealers, workers, investors – are deeply unhappy.

“I ponder that has penetrated the board and made his position untenable.”

Stellantis’ distribute worth has fallen by 40% since the commence of this year, a far worse act than its rivals. Following Mr Tavares’ departure on Monday, it fell further, down more than 9%.

Mr Tavares already agreed to step down in 2026, rather than extending his deal – a shift that arguably weakened his position significantly.

Stellantis said it now expects to appoint a recent boss by the middle of next year.

In the meantime, it will set up a recent interim executive committee, headed by the firm’s chair John Elkann who is a member of the powerful Agnelli household of Italian industrialists.

Mr Elkann controls a significant voting stake in the throng on behalf of his household.

He is the one currently leading the search for Mr Tavares’ successor and his views will be crucial in shaping the upcoming of the automotive giant.

Mr Tavares frequently made headlines in the UK by casting question over the upcoming of Vauxhall operations, linking it to issues such as Brexit and government plans to force carmakers to construct more electric cars.

It is not yet obvious whether his departure will affect the planned closure of Stellantis’ Luton plant.

Stellantis’s Vauxhall plant in Luton currently builds petrol and diesel vans and had been due to commence making its medium-sized Vivaro electric van from 2025, before the selection to close it.

The business is now planning to merge its electric van production at its other UK plant in Ellesmere Port in Cheshire.

In Europe, Stellantis has suffered the same fate as many other manufacturers – coming under pressure from Chinese rivals at a period when receive-up of electric vehicles has been more sluggish than expected.

A tie-up with the China’s Leapmotor may reap dividends, but is in its early stages.

On what the transformation at the top means for Luton, Prof Bailey said: “I ponder everything is up in the air. Whether or not that could be reversed I don’t recognize. One would aspiration but I suspect that that has gone sadly.

“I don’t ponder there are any guarantees about the upcoming whatsoever of Stellantis’s operations in the UK.”