Hello, welcome to Stellantis Full Year 2021 Results. I will now hand over to your host, Andrea Bandinelli, Head of Investor Relations, to begin today's conference. Thank you.
Thank you, Susan, and welcome to everyone joining us today as we review Stellantis' full year 2021 results. Earlier today, the presentation material for this call, as well as the related press release, was posted under the investor sections of Stellantis' Group website. Today, our call is hosted by Carlos Tavares, the company's Chief Executive Officer, and Richard Palmer, the company's Chief Financial Officer. After both Mr. Tavares and Mr. Palmer present, they will be available to answer questions. Before we begin, I want to point out that any forward-looking statements we might make during today's call are subject to the risks and uncertainties mentioned in the safe harbor statement included on Page two of today's presentation. As customary, the call will be governed by that language. Now I would like to hand over to Carlos Tavares, CEO of Stellantis.
Thank you, Andrea, and good morning, good afternoon, and good evening to you all. Welcome to this Stellantis 2021 financial results announcement session. Richard Palmer and myself, we are delighted to host you today, and it is our privilege to present to you some highlights and a few comments about this year's results, 2021 results. Please be aware that we really appreciate your time. We know that your time is very valuable, and I would like to thank you accordingly for your interest in Stellantis. Indeed, 2021 was a very heavy year. A year where we had to do three different kinds of things. First one, in January 2021, we created Stellantis. We had to set up a new business governance way with nine dedicated committees.
We set up the top leadership team of this company, and we created new organizations up to CEO level minus three, with more than 2,500 new assignments in the company. We started a very busy year in setting a brand new company called Stellantis. That's point number one. Point number two, we had to fight all the headwinds that you know, mainly three, the semiconductor supply shortage, the raw material cost inflation, and more and more stringent CO2 regulations. Those were the headwinds that we had to face. Point number three, we spent significant amount of time working with our cross-functional teams on the long-term initiatives that I will be presenting to you on March 1 st, meaning next week, to describe what our long-term strategic plan is and what are the initiatives that we are going to take over the next few years.
Those three layers of activities represented for our teams and for our employees a very significant workload, and I would like to take this opportunity to thank them all very sincerely, very warmly. I very much appreciate what they have done. I thank them enormously, and I congratulate them for the results that you already know. As you know, the results for 2021 were very encouraging with nearly the double of operating income amount, the triple of net income compared to last year, a record operating income margin of 11.8%, and also a quite rewarding EUR 6.1 billion of positive free cash flow. Those are the results. You know them. You have seen them in the press release.
What I would like now to do with Richard is to comment some of those results so that you can understand how we could, as an organization, come up with those numbers. Beyond the record 11.8% adjusted operating income margin, it is fair to notice that on the second half of the year, we were even slightly better with 12.2%, which says a lot about the initiatives that were taken in the company. Needless to say that we were able to finish this year with a break-even point, which is below 50%, which as you know is a very important guideline for the way we are managing the company.
It is also important to see that the EUR 6.1 billion of industrial free cash flow were significantly supported by a very, significant level of cash synergies, no less than EUR 3.2 billion, which is aligned, with what we have committed to the market, which is the fact that the merger will generate on a run rate EUR 5 billion per year, which represents a EUR 25 billion v alue creation as the result of this merger. Of course, this first result of 3.2 just means that we are going to deliver on our commitments. I hope this is not going to surprise you because this is the pattern of our management.
We also could demonstrate that our low emission vehicle sales are growing significantly by 160% year-over-year to reach 388,000 units in 2021. We can say that we are now moving faster and faster on the LEV sales, which is of course good news when we anticipate what may happen very soon in the markets where we operate. We were still, and I would say even more, the leaders of the LCV market in Europe and South America with respectively 33.7% and 30.9% market share. We are very solid leaders, and we have a very strong product plan as you will see later on with a perfect coverage of the market, not only on vehicles themselves, but also on powertrains.
Last but not least, as you already know, we were pleased and privileged to present to you in July our electrification day, electrification journey during the Capital Day. In December, we could present to you the software capital day, our software plans to give you two of the most important pillars of what will be the framing of our long-term strategic plan. Last but not least, we have made several deals in 2021 with some highly technological partners with whom we want to accelerate our transformation from a legacy car maker to an automotive tech company, which is what we are doing right now. Those are some of the highlights.
Again, I would like to express to our employees, to our management team, to our top leadership team, to you the investors, to the media, and to the board members all the support we received from them over this quite critical year, the first year of Stellantis with record results. This is what I would like you to keep in mind. You see on this slide also that we are going to bring Maserati back to racing. It is a significant opportunity for our company. It's the unique luxury brand of Stellantis, and we are going to make this brand, of course, electrified. Bringing back Maserati to the world Formula E Championship is also meaningful of the strategic direction that we are taking for this luxury brand. Let's move to the next one and comment on the regions.
Let's start of course with North America. Why? Because North America is right now the most profitable region of the company with a record 16.3% AOI margin, which says a lot about the way our North American team is mastering the business model of North America. It's important that they take the best out of the market conditions, and this is exactly what they have been doing. We can see in that we have been able to deliver the highest U.S. retail average transaction price among the Detroit Three OEMs with a significant improvement of 20% year-over-year to reach no less than $47,000 per car. Significant result that also highlights the fact that our North American teams are mastering the business model.
We have entered into at least two separate MoUs for battery joint ventures with the Korean partners to bring to the North American market the appropriate level of battery supply, no less than 63 GW hours by 2025. This is, as you may imagine, strategically important to secure the profitable growth of our electrified vehicles in the near future. We can also demonstrate that we have been launching very successful products, starting with two white space products like the Jeep Grand Cherokee, long version, and also the Wagoneer and Grand Wagoneer. Those are white space products that are very profitable. We have launched those products, and we expect that to be a significant profit contributor for our North American operations.
Our all-new Jeep Wrangler 4xe is now the number one selling PHEV in U.S. retail, which means that the brand, the Jeep brand, has been able to make the appropriate and the right decisions on the right timing to be demonstrating our competitiveness in the market right now with the number one selling position on the PHEV for the U.S. retail. It is important to see that the Jeep brand is absolutely on the right tempo to surf on the successful electrified technology of our company. We can also see that, in terms of, the highly profitable pickup truck market, we have been delivering the best ever U.S. commercial fleet market share at 18.7%, which represents an improvement of 340 basis points year-over-year.
As you can see, North America, it's a record profitability with some significant sales and marketing successes, good strategic agreements to support electrification in the near future, and the best average transaction pricing against the Detroit Three in the marketplace. If we move now to the next region, which is Enlarged Europe, we can say that Europe has demonstrated a very strong profitability with no less than 9.1% AOI margin for the full year, but also in the second half, an improvement to 9.4%. Some of the initiatives that we're taking to improve the efficiency of the business model are now visible.
We see that we are now in Europe, totally compliant in terms of CO2, on a standalone basis, meaning that Stellantis is now able to embrace the full scope of our iconic brand portfolio while being fully compliant. We are delivering a good result at 110.6 grams per kilometer, which is a little bit better than what we expected. That's good. It means that most probably we are in the leading pack, if not the leader, in terms of CO2 emission reduction in the European market, which is some of our DNAs. In Eurasia, we are growing. We grew to 1.6% market share, 50 basis points year over year. I'm sure that you will have some questions about that later on, so I will skip here.
On European markets, our market share was stable at 22.1%. We see that some of our Western competitors have lost market share. Some of our Asian competitors were able to gain market share. As regards Stellantis, we were stable at 22.1% market share, which represents the number two position in the European market. We also see that we have been making very significant improvements and progress on our LEV sales mix in Europe. We moved in one year from 9% sales mix to 18.1% sales mix, which means that we are moving fast and strong in our ability to sell pure LEVs.
Which is good because, of course, the market one day will turn totally to the LEV technology, which means that we are now ramping up fast and strong in Europe from 9% to 18% LEV sales mix over the year. Last but not least, we completely reengineered our distribution model. In fact, we are currently discussing with our dealer network, dealer associations in a highly constructive, and I say, I would say encouraging way, to adapt our distribution model to a higher level of quality in the way we make the customer enjoy its journey with our company and with our brands. And at the same time, reduce the costs of distribution as we need to fund the electrification of our portfolio. This is for Europe. If we move now to the other regions, starting with South America.
South America is a strong winner. It's number one in Latin America for Stellantis. It's number one in Brazil for Stellantis. It's number one in Argentina for Stellantis, with respectively 22.9%, 32.0%, and 29.1% of market share. We are the clear leader in Latin American markets. It is good because at the same time where we are leading the market and increasing our market share against last year, we have also significantly improved the profitability, as we have now multiplied by five the amount of profit that we could extract from the Latin American markets with an AOI margin of 8.3%, which is much, much better than what we could experience in the past.
While this was happening, Fiat was the number one selling brand in South America and in Brazil, enjoying namely the success of Strada as a top-selling vehicle. South America, a leader, more share, more profitability, and number one selling brand with Fiat, a big success. Let's move now to Middle East and Africa. Here we have also a very rewarding double-digit AOI margin of 10.5%, which nearly doubled against the previous year. We have the potential to grow market share in some markets, major markets. We had some headwinds in Egypt and Turkey. But for the other markets, we could increase the market share significantly.
We are now introducing out of Morocco the Opel Rocks-e, which is a downtown mobility device that has been facing big success under the Citroën brand as the Citroën Ami and the Citroën Ami Cargo, which is the LCV variation of the Citroën Ami. We see that the production is growing. We see that this is profitable and that we have good potential to continue to grow profitably on these downtown mobility devices. Last but not least, China and India and Asia Pacific, so the Asian regions. We see that the AOI margin is also quite rewarding with north of 11% AOI margin, which combines with the net revenue that is up by 24%, which is good.
We see that we are now clear on the agreement we have with GAC to create a Stellantis Jeep JV that we will control in China to add to the very profitable Jeep CBU business some CKD complement from this JV. Despite some bumps in terms of communication, the deal is inked, and we expect now that the Chinese authorities will approve the deal so that we can go live. Last but not least, in India, we have the all-new Citroën C3, which has been developed from India to India and to other parts of the world. It is a very cost-competitive project with a very modern and attractive design, as you can see on this photo.
We expect to launch this program from H1 2022, and that will give the company a significant capability to bring high value and affordable products for the overseas markets, and not only, of course, but namely for those markets. Now we have this very important tool to grow profitably on some overseas markets moving forward. That was for the regions. Let me now move for the brands and, of course, start with Jeep, our global SUV brand. A lot of great things in terms of achievements for this brand. First of all, let's keep in mind that Jeep means freedom. It's all about a very sharp positioning on the marketplace all over the world. The pricing power is fine. Either better than the benchmark or very close to the benchmark.
We see that in 2021 we could launch the Compass, the Renegade, and the Wrangler 4xe variations in four regions, which means that the electrification of the Jeep brand is now a reality. It's not a plan, it's a reality, and you can see it because if I take the example of the European market, we have a 25% LEV mix in Europe, whereas the total sales of LEVs in Europe represent, as I said, 18% LEV mix. Jeep is pulling the LEV mix of Stellantis in Europe up, which is a great thing. We see that this is a trend that we will reinforce in the near future as it is exactly what the customers are expecting from us. We also can notice that the Grand Cherokee has delivered the best U.S. sales since 2000.
That we are with the Jeep brand, the SUV market leader in South America with 14.1% segment share in 2021, and that we could also enjoy the highest ever Wrangler, Jeep Wrangler sales in Middle East in 2021. You see a lot of great achievements in terms of sales and marketing, in terms of electrification. Needless to say that this is a very profitable brand. Needless to say that the positioning of Jeep is the same all over the world, including in China, and it has demonstrated a high potential for profitable growth in our company.
If we move to the next brands, which are the American brands, while we are preparing the rebound of Chrysler with some exciting products that we have been discussing in design studios, we noticed that the brand CEO from Chrysler has announced that the brand will be 100% BEV from 2028. The pricing power is fine, and the Pacifica is achieving the best U.S. sales on record for this brand with a PHEV variation. Which means that with a PHEV electrified variation, we are doing fine in terms of sales. Ram is a success story, a significant success story with the best full-size pickup share ever in the United States with an impressive 26.2% share in 2021. It's a growing share. It's a growing profit.
The products are extremely appealing, and the customers are very excited about all the variations that we have been bringing to the marketplace. Pricing power is ahead of the benchmark, and we have with the Ram 1500, the highest U.S. average transaction price with a $51,000 per unit number in 2021, which means that we are taking the best out of the market given the appeal and the market conditions that we have right now. Last but not least, the Dodge brand. Very high satisfaction with the fact that the Challenger was the number one selling muscle car in the U.S., which means beating Ford with 54,000 units sold in 2021. A very nice pricing power, seven points ahead of the benchmark.
For Charger and Challenger, the highest ever market share with more than 50% market share in the full-size sedan segment in 2021. Not only those numbers are extremely rewarding, but we are very, very excited about the electrification of the Dodge brand, which is coming up very, very nicely, and I can tell the fans of this brand that they will enjoy even more excitement and thrilling experiences with the electrification of Dodge that will bring the American E muscle car to the market. If we move now to the upper mainstream brands with two European brands. Our German brand, Opel, delivered a market share that was up in Europe and Germany with respectively 4.3% and 6.2% market share. It's good that we have an improving market share in the home country of the brand, which is Germany.
That demonstrates that we are properly rooted in that market. The Mokka -e model was awarded Golden Steering Wheel in 2021. Best car under $25,000, which is a tribute to the very attractive design and the performance of this car, which I believe is a great success. Pricing power is at the benchmark level. We have also to mention that in their respective segments, Corsa was number one sales in Germany and in the U.K. with 16.5% and 15.1% segment share. Which means that the Corsa, which is, as you know well, a derivative of another car from our company, has been delivering a very high level of appeal, great quality, and great performance to our customers.
You can see it as it is the number one selling car in Germany and U.K. in its own segment. Beating, of course, the equivalence of other brands, including the German brands. If we look at Peugeot is also a big success with the 208 being the number one selling vehicle in Europe. The 2008, the number one selling B SUV in Europe, which means that they are demonstrating a very nice overall package, design appeal, performance, reliability, and quality. We also see that Peugeot has now become the number one brand in France, which didn't happen for many years. Peugeot is now number one in France for this important market, for this home market. Globally, worldwide, the sales were up 5%. The pricing power is above the benchmark.
We see that the Euro 30 LEV order is increasing. This means that Peugeot very soon will have a total market share of LEV in the LEV market, which will be above the total market share of this brand in Europe, which is rewarding. We moved from 9% order mix to 25% order mix on the LEV for this year of 2021. Moving fast and strong on the electrification without, of course, forgetting the very nice start of the Peugeot 308, brand new Peugeot, that is attracting a lot of customers thanks to a very attractive and aggressive design. If we move to the next one, and let's talk about the core brands, namely Citroën and Fiat.
Citroën has been enjoying a great success with the C-segment C4 hatchback, top-selling C-hatch in France and Spain for 2021, but also a very nice performance on the BEV variations, which were multiplied by four year-over-year with a ë-C4 at 8.7% of its segment in terms of BEV competition. The ë-C4 is receiving a very good support from the market and from the customers. The share in South America is up and the pricing power is above benchmark, so more to come on the Citroën brand, but already with the C4, a big success right now. Fiat has demonstrated a strong leadership with the three remarkable results, market leader in Brazil as a brand, market leader in Italy as a brand, and market leader in Turkey as a brand.
Overall, number one brand in South America with 13.9% share in 2021, so great achievement from our teams in terms of leadership for those markets. The 500e is now the number one selling BEV in 12 countries for the A segment, so perfectly in the leading seat for the electrification of Fiat. Pricing power ahead of the benchmark. A commitment from the brand CEO that we would be 100% BEV portfolio by 2027 in Europe, which means that we have now in the pipeline all the pure EV products that we need to be having a strong position in the different markets in which the Fiat brand is operating.
If we move to the next one, we can now address the light commercial vehicle business, highly profitable, where we are perfectly leading Europe with a 33.7% market share and South America with a 30.9% market share. We have sold 1.9 million cars globally, which means this is a big, big business for our company.
We are also now preparing the all-new ProMaster EV Ram Van, which will be launched in 2023, with Amazon as our first commercial customer, which means that we were able to convince Amazon that we had the best van with the best features, perfectly suited for the logistics expertise that exists in our customers, and we are meeting those needs with a very fine-tuned and very sharp van in this process, starting of course, with the EV powertrain that we will bring to the United States in 2023.
We have also in Europe the number one BEV sales position on vans, which just demonstrates that by having the EV variation on the three vans, compact, mid-size and full-size, we are now leading the market not only on total share, but also on the BEV sales for electrified vans in Europe. We could also deliver the best ever performance in terms of sales for the pickup sales with more than 1 million vehicles sold in 2021, which demonstrates that not only our vans are extremely successful, mostly in Europe, our pickup trucks are now demonstrating on compact, again, mid-size and full-size pickups that we are extremely competitive. By adding the vans to the pickups, we will be soon competing for the number one position in the world.
It is also clear that one of the good things that was brought by the merger is the fact that we are now launching, and as you can see very fast, the all new Fiat Scudo and Fiat Ulysse as a derivative of the other vans of our company. It has been launched. It will bring even more competitiveness and surely more profit to Stellantis. Last but not least, in December 2021, we delivered to our first customers our mid-size van with a hydrogen fuel cell technology. It was delivered in December. We are now moving up, both in the orders and the manufacturing capacity.
Next week, I will tell you more about this, but I just want here to put a stake in the ground by saying that in December 2021, we start selling mid-size vans, hydrogen-powered, in the Stellantis brand portfolio. Here we have the picture for the Opel, but it also exists for other brands in Europe. It's a significant technological leadership that we are focusing on the LCVs, and I'm so glad that our teams could deliver those first vans in December 2021. If we move ahead, we can now talk about the premium brands.
By saying that, the Alfa Romeo brand CEO has committed that he will be 100% BEV portfolio from 2027, and that, he is now not only fixing the business model as he was able to bring the Alfa Romeo brand to profitability in 2021, moving from red ink to black ink with the pricing at the benchmark level. It's clear that the turnaround is on track, and we are now gaining a new momentum with the launch of the Alfa Romeo Tonale that will happen in 2022 with its first electrified vehicle, which means that electrification journey of Alfa Romeo is just starting, which means that we have a significant potential to grow profitably with this brand now that the business model has been fixed.
For the Lancia brand that we are now preparing for the rebound, we can say that we'll be 100% electrified in 2024, and that from 2026, all the launches will be purely BEV. The pricing power is minus 20% against the benchmark, which is a way to say that there is a significant potential to improve moving forward, which is great news. This is exactly what we are going to do. That means that the Lancia brand will represent a significant profit driver for the company moving forward.
While we are preparing for this rebound, I think we need to congratulate the Lancia teams for the fact that the Lancia Ypsilon is still the number one selling car in Italy in the B segment, which is a very significant sales and marketing performance with a 6.3% share in 2021. Last but not least, the DS brand, DS Automobiles, the unique French premium brand, will make 100% BEV launches from 2024, is better than the benchmark in pricing power, and has the second-best LEV sales mix of the premium industry with no less than 37% mix for 2021. Here is one other brand that is bringing the LEV sales mix of Stellantis up with a quite impressive 37% sales mix.
To finalize this part, I think we are going to comment now the Maserati brand, the unique luxury brand of Stellantis. The first great news is that we were able to bring the brand back to the black with a 5% AOI margin in 2021. Needless to say that our goal is to bring the profitability of Maserati in the midterm above 15% AOI margin, so a significant potential to improve. It is clear that the Maserati team has been doing a great job because they were able to grow the sales by 41%, to grow the market share globally in North America and in China, and at the same time, improve the profitability, which is the perfect demonstration that they are creating value for the company.
While we are doing this, we are putting the level of demand on quality at a very high level. We are demonstrating that we are absolutely stiff in quality, making sure that any new model that we are going to launch in any brand of Stellantis, and specifically on Maserati, will be meeting all the very demanding standards, quality standards that we have in the company. This is the reason why we decided to delay a few months the all-new Grecale. We want the car to be perfect. We have tested the car many times, and now the car is ready, and it will be unveiled in March 2022, and the deliveries will begin by mid-2022. The all-new Grecale is, of course, a turning point, a cornerstone for the Maserati brand.
As I already mentioned on the opening, we'll bring Maserati to the world Formula E Championship in 2023 as a testimony of our electrification and the fact that we love to compete on this brand, which is positioned as the GranTurismo brand of Stellantis. In 2023, we will also bring the all-new GranTurismo, which is right now on track. The car is gorgeous, and you will see that you will be surprised when it will come up to the market at the moment where we will consider that the quality is top-notch, meeting all the standards and therefore at the right level to be enjoyed by our customers. Maserati is the starting point of a great story, more sales, more market share, more profit, more quality, and more competition.
This is what we are now doing, and I'm quite convinced that this is going to be a success story for the future. Those were the brands for the cars and the products. Let's now talk about the services. The mobility business is now expanding. The good news is that the growth is there, and the numbers are black. It is important in the way we think that we grow our performance while we keep things in the black, which is quite rare among our competitors in this kind of services. As you can see, Free2move is now growing by 38% while we keep the business in the black thanks to the fact that we are introducing more and more cities, namely in the United States, that can enjoy this mobility service.
We see that the long-term rental originations are growing up 15%. It is also the case on the leases side, with an even more impressive number of 45%, driven by B2C growth. We see that the growth is there, both in Free2move and leases. In both cases, we are in the black, and we will keep it in the black. There is some acceleration to come in terms of electric mobility. As you can see, the mix of LEV is growing by the day, not only on the lease sales, but also in short- and midterm rental. It is also the case on the leases side. But on top of that, on the leases side, we have made some acquisitions, as we can see here, Easirent in the U.K. and Sadorent in Portugal to expand our mobility ecosystem.
The reason why we are aggressive on this area is because we believe with some humility that we have found the way to keep the business profitable and at the same time grow our presence, which is, from my perspective, the right way to go. I'm very pleased with this direction, and let's continue to do more of the same so that we can enjoy a better business from this mobility services activities. If we move now to the affiliates, three major businesses. One is the financial services. We were blessed to create the Stellantis U.S. Financial Services from the acquisition of an existing entity. This captive is now formed, and we are moving ahead, and I think that we will start seeing the first benefits of this strategic move from next year.
Stellantis has now a financial service in the U.S. to support sales, which is going to be a great tool for our sales and marketing people. We are also creating a fully dedicated multi-brand leasing company in Europe, which will go live in the beginning of 2023. There is enormous potential here compared to our peers, and this is something that we are very excited about, trying to move as fast as we can. We will do this in partnership with Crédit Agricole. We have achieved, while we were completely reengineering our strategy in terms of sales finance, we are achieving a record profitability with no less than EUR 662 million in 2021, which is a tribute to the expertise and the focus of our financial teams, and congratulations to them.
If we look at the pre-owned vehicle business, of course, the business model has been improving given the market conditions. It's good that we do it. We didn't do it only on the top line. We did it also on the costs because we could reduce the logistic cost by 40% by executing a certain number of synergies coming out of the merger. We had a very successful IPO of the Aramis Group with a valuation of the company at EUR 1.9 billion, knowing that our initial investment was a two-digit number, so a limited investment that triggered a lot of value creation over the years. A successful IPO of Aramis. We will continue to expand our pre-owned car brand called Spoticar across the different countries.
Here we are now starting the operations in Turkey, which is a significant market for us. In the parts and service business, we could enjoy double-digit sales growth, which is not very common, significantly fueled by the independent aftermarket business, which was up by 25%, and by the circular economy business, which was up 40%. We could create, through the merger of three entities that we have acquired in the past, the fourth-largest IAM distributor in China, with a sales growth of 30%. The global business is in the black. Even though it's not a big number, it's still in the black. We are growing as a distributor in China, which is a success of Stellantis in China right now.\.
We selected Mopar as the brand to sell the OEM parts when needed to some of our partners. This is a significant profit provider for Stellantis. As you can see through the different columns here, everything was growing profitably, which is, of course, contributing to the excellent results that you could see this morning. Let's move to the next one, which is about electrification. I know that this is a topic that is very important for you, and I wanted to give you more transparency and more details about what is going to happen in the next couple of years. First, let's just recognize that as we speak, we are selling 34 LEVs in the markets where we operate, which include 19 BEVs. As we speak, we are selling 19 BEVs all over the world, 19 BEVs included in 34 LEVs.
As you know, for us, LEVs means BEVs plus PHEVs. Nineteen BEVs are actually and right now on sale for the different Stellantis brands. If we look at what is going to happen this year and next year, within 2022 and 2023, we are going to add to those 19 BEVs 13 additional BEVs, which means that by the end of 2023, we will have 32 BEVs on sale, which means roughly one-third of the total model portfolio of Stellantis. Which is, I believe, a significant achievement from our engineering, purchasing, and manufacturing teams, and I would like to thank them and congratulate them for that. Please keep in mind, right now, 19 BEVs on sale. For the next couple of years, 2022 and 2023, we will add 13 more, and we'll therefore have, by the end of 2023, 32 BEVs on sale.
This is what we have in our pipe. You can see through this slide the power of Stellantis with our 14 iconic house of brands. We have a very powerful capability to launch new technologies and cover the profit pool of our markets. Please keep in mind the 32 BEVs that will be soon on sale, and right now 19. No less than 19. This is to clarify one of the questions I got from you after the EV Capital Day. We got the feedback that you wanted more visibility and more transparency on the pure BEV launches. This is the answer. Hopefully, it is clear enough for all of you. Let's move on. Let's now move to the numbers.
For the numbers, that needs a lot of rigor and focus, and I will be happily handing over to our CFO, Richard Palmer. Richard, please.
Thank you very much, Carlos. Just quickly to remind everybody, given the merger, the numbers we'll be focused on today are the pro forma numbers for 2021 and for 2020, which effectively means that they're prepared as if the merger had occurred on January 1, 2020. Including FCA's numbers in the 2020 comparatives and including the first 16 days of 2021 for FCA in the 2021 numbers, all adjusted for PPA purchase price accounting exercise. We can move to the next page. Here we show the main financial metrics. As we mentioned, consolidated data shipments increased 4% to 5.9 million units, with the impact of unfilled semiconductor orders largely offsetting the reduced impacts of COVID-19 compared to 2020.
North America and extended Europe regions were down 2% and 3% respectively, with strong growth in South America, China, and India, and Asia Pacific, and Middle East and Africa. All brands were up except for Dodge due to discontinued Grand Caravan and Journey, Alfa due to brand repositioning and discontinued Giulietta and Opel/ Vauxhall. Revenues were up 14% to EUR 152 billion due to strong commercial performance on pricing and product mix. This strong commercial performance drove AOI to nearly double year-over-year to EUR 18 billion, with margins at a record level compared to prior PSA or FCA performance at 11.8%. Industrial free cash flows reached EUR 6.1 billion, up 85% year-over-year due to the strong AOI margins and to the synergies.
Industrial net financial position therefore improved to EUR 19.1 billion of net cash. Industrial liquidity at year-end reached nearly EUR 63 billion, of which EUR 12.7 billion related to the undrawn RCF and committed credit lines. On page 20, we show the rest of the P&L. H1 2021 included unusual charges of EUR 1.1 billion due to the inventory fair value adjustments for PPA of EUR 0.5 billion, restructuring of EUR 0.7 billion, and gains for resolution of tax matters in South America of EUR 0.2 billion.
In the full year, the unusual charges totaled EUR 2.7 billion, with an additional EUR 1.6 billion in H2 due to further restructuring of EUR 0.3 billion, a change in accounting estimates for certain types of warranties of EUR 0.7 billion, and asset impairments of EUR 0.3 billion. Financial charges for the year were EUR 746 million, up 11% versus 2020, mainly due to lower levels of interest capitalization on investments in progress and lower yields on cash balances. Full year tax expense was EUR 1.9 billion, with an effective tax rate of 13%, and included the deferred tax assets recognized for tax loss carryforwards of around EUR 1.4 billion. Excluding this one-off DTA amount and some other smaller tax adjustments, the ETR normalized would have been around 23%.
As a result, the net profit for the year, as Carlos mentioned, nearly tripled to EUR 13.4 billion. Turning to Page 21, we show the drivers of revenue growth for the year, which drove a 14% increase or 16% ex negative FX impacts, mainly due to the US dollar versus the euro, the real versus the euro, and the Turkish lira. Full year volumes were up 207,000 units driven by South America, + 270,000 units with China and India, Asia Pacific, MEA, and Maserati, all positive, offsetting North America down 32,000 and Enlarged Europe down 80,000. Net pricing was strong throughout the year with all segments positive, and North America, South America and MEA, the standout performers.
Vehicle line mix was also strong and driven at 65% by North America and 30% by extended Europe. Moving to page 22, we focus on the AOI development. As we said, volumes were up around 200,000 units or 4%, with significant production losses throughout the year due to chip shortages. In this context, we focused on margin maximization. The commercial teams did a great job with a net price up of around 6.5% for the group and all regions positive. Vehicle line mix was also very strong, particularly in North America, where we had key new products with the Grand Cherokee and Grand Wagoneer, and also focused production through the year on the higher margin vehicles, in particular Ram.
These top-line actions offset raw material inflation for the year of around EUR 2.25 billion, and industrial inefficiencies due to the stop-go nature of 2021 due to chip shortages, inflationary pressure, and FX impacts, particularly in South America. SG&A was flat, also due to synergies from indirect purchasing and media buying. R&D increased mainly due to the launch of new products in North America, increasing the depreciation and amortization and increased spend for new products compared to prior year. The resulting AOI margin, at 11.8%, was up 70% year-over-year. Now we move to the regional performance, starting on page 23 with North America, which had a record performance for the year with margins at 16.3% and H2 at 16.4%.
Industry volumes reached 18 million vehicles, up 4%, and our sales were down 3% at 2 million units, mainly due to U.S. fleet down 13% and Canadian fleet down 40%, impacted by supply constraints and the discontinuation of the Dodge Journey and Grand Caravan. Our North America share was down from 11.8% to 11.1%, and shipments reached 1.8 million units, down 2% year-over-year, with Dodge down 30%, Jeep down 5%, and Ram up 16%. Revenues increased 15% to nearly EUR 70 billion, with a strong increase in ATPs as mentioned earlier, driven by net price and strong product mix from Ram volume and increased Grand Cherokee and new Grand Wagoneer volumes.
Industrial costs were negative due to raw material inflation and logistics and other industrial efficiencies due to the stop-go of chip shortages, increased D&A for new product launches, and increased labor costs for variable pay due to the strong results. R&D increase relates to amortization of program costs for the new model launches. On Page 24, we show our South America performance, where in an industry up 14%, our sales reached 812,000 vehicles with share up 3.85% points to 22.9%. In Brazil, our share reached 32%, in Argentina, 29%. With our overall sales up 37%, for the Fiat brand was up 34%, Jeep 35%, Peugeot up 56%, and Citroën up 40%, so all brands performing very positively.
Shipments increased 48% to 830,000 units with our South America business less impacted than North America and Europe by chip shortages. Revenues increased 71% to over EUR 10 billion with very strong net price performance, offsetting negative inflation in industrial costs and G&A. This strong performance resulted in an AOI increasing by five-fold to EUR 882 million with margins at 8.3% for the year. Enlarged Europe results are shown on page 25. In a flat 2021 industry, Stellantis EU 29 share remained at 22.1%, number two in the industry. H2 share was down compared to H1 due to continued focus on improving price mix and reduction in total stock levels through the year of around 40%.
In fact, AOI was up 76% to EUR 5.4 billion, and margins were 9.7% from 2.4% the prior year. Shipments for the year were down 3%, with semiconductor availability impacting the four highest volume brands at similar levels, and newly launched Opel Mokka, Citroën C4, and Fiat 500e performing well. Despite shipments being down, revenues were up 5% with positive price and mix driven in particular by increased LEV volumes, which more than doubled in the year, and by the Peugeot brand portfolio and new model launches as mentioned for Citroën, Opel, and Fiat. Costs were well managed with raw material inflation offset by purchasing savings and inefficiencies due to stop-go of chip supply, offset by manufacturing actions and by reduced compliance costs.
FX was marginally positive due to sterling strengthening, and other impacts included improvements to parts and service and used car profitability. Turning to Page 26, we review Middle East and Africa, where the region achieved double-digit margins and AOI increased over 80% to EUR 545 million for the year. The industry was up 19%, with all major markets up strongly, with the exception of Turkey, down 5%. Our regional market share was down to 11.9% from 13.6% in the prior year, as vehicle shortages and strong pricing actions in Turkey impacted sales performance, which was still up 4% to 412,000 units. Consolidated shipments were up 6% and positive pricing offset significant negative FX impacts due to the Turkish lira, resulting in revenues up 9%.
On Page 27, we move to China and India and Asia Pacific, where consolidated shipments increased by 26%, with China up 17% and India and Asia Pacific up 28%. Jeep brand increased 30% and represents around 50% of the 120,000 shipments. Peugeot was up also 30% to 30,000 units. Revenues increased in line with shipments to nearly EUR 4 billion for the year, and actions on mix improvement and pricing offset negative FX to improve margins to 11.1% and nearly double AOIs to EUR 442 million. Moving to Maserati on the right, Maserati sales increased 41%, as mentioned, to 24,000 units, with sales up 20% in Europe and over 40% in China and U.S.
Improved pricing and residual values due to the refresh versions in market, as well as the improvement in volumes, allowed Maserati to close with AOI at EUR 103 million and 5.1% margins. On Page 28, we show the industrial free cash flow, which reached EUR 6.1 billion for the year, despite the slow start in H1 due to net working capital and provisions, which closed the year -EUR 2.9 billion, an improvement of EUR 2.8 billion compared to H1. This resulted in H2 in industrial free cash flow of EUR 7.2 billion. Looking at the elements of the cash flow, AOI before D&A reached 15.7% margins, a further improvement from a strong H1 of 15.3%.
CapEx and R&D capitalized totaled EUR 10.2 billion of the EUR 10.9 billion in investments, which also includes the acquisition of the US Finco and other equity injections into joint ventures. Total CapEx and R&D spend was EUR 13 billion or 8.6% of revenues. The negative working capital is driven by lower year-over-year payables, with November-December production of 1.04 million cars, down over 100,000 units year over year, partly offset by improved inventory levels. Changes in provisions were driven down by the reduction in dealer inventories through the year of 390,000 units. On Page 29, you can see that reduction in inventory. We continue to operate at historic low levels of inventory, with total inventory down 37% in the year and dealer inventory in line with that reduction.
This has allowed us to sustain sales performance by increasing turn rates and offsetting some of the chip shortage impacts. The reduction is at similar percentages in North America and extended Europe, and does show some increase since the low point in September, which was due both to summer shutdown seasonality and particularly bad chip shortages in the June to September period. The last page of the financial section shows our outlook for the industry, where we see moderate growth in our key regions, also heavily dependent on supply volatility.
As regards AOI margins, we expect to continue to operate with double-digit margins and to offset headwinds in 2022, which include continued semiconductor scarcity, supply chain constraints due to labor costs and absenteeism, particularly in North America, and raw material inflation of around EUR 4 billion year-over-year, up from the EUR 2.25 billion in 2021. Industrial free cash flow will be positive and allow us to continue to invest 8%-9% of revenues in CapEx and R&D to execute on the numerous LEV and BEV launches that we mentioned earlier. Thank you. Thank you for listening, and I will turn the call now back to Carlos.
Well, thank you. Thank you, Richard, for this very focused explanations. To wrap up on this first part before we go to your questions, I just would like to highlight a couple of things. First, in 2021, we were blessed by the fact that our company is enjoying a very thrilling diversity. Our company is very diverse. As you know, historically, our company is built out of many other car companies with different brands, different home countries, and therefore, diversity for Stellantis is a differentiator. But more than that, diversity at Stellantis is a way to enjoy a very exciting journey for all of us. We see it through the immense number of resumes that we receive.
We receive enormous amount of resumes of people who want to join this journey. Very surprisingly, many of those resumes are people currently working in tech companies, and they see a breathing space, they see opportunity to change, they see opportunity to build, and they see the opportunity to enjoy an exciting journey as a team. This diversity has been really a very important factor of our good results in 2021. We also see that, of course, the challenges that we have ahead, which are most of them external challenges, can be overcome in a more efficient way if we understand the world in which we operate in a more focused way and a more sharp way. Of course, diversity is also very helpful to understand the world in which we are operating. That's point number one.
Point number two, we are blessed by the fact that we have a strong bottom-up support from our people. Our people understand why we did this merger. They understand that Stellantis makes total sense from a scale perspective, from a diversity perspective. You can see that the very high level of synergies that we could deliver in 2021, no less than EUR 3.2 billion, is the result of a significant bottom-up trend. Our people understand why we do this, and our people are rewarding us with many, many synergies, even though those that we couldn't think of during the discussion that was done prior to the deal of the merger.
This accelerated pace of synergies is demonstrating that we have a significant bottom-up support. Which, of course, is also a very important driver for the profitability, the record profitability that could deliver in 2021. Last but not least, as we are steering the company fast and strong towards an automotive tech company, we need to recognize that some of the key strategic partnerships with the tech companies are going to be boosting the transformation of this company, not only on electrification, but also on software. I will be pleased to explain to you all the details of this shift during our long-term strategic plan presentation next week. It will come very soon on March 1st. Thank you for your attention. Greatly appreciate it, and let's now go for the Q&A, please.
Thank you. If you'd like to ask a question on today's call, please press star one on your telephone keypad. To withdraw your question, please press star two. The first question comes from the line of José Asumendi from JP Morgan. Please go ahead.
Thank you very much, Carlos and Richard, for the presentation. José from JP Morgan. A couple of questions, please. I'm trying to understand the opportunity to maintain the margins in North America at the current elevated levels. Carlos, can you comment a little bit around the opportunity to maybe sell another 50,000 vans in North America and continue to take market share there? And Richard, can you split, please, the industrial costs in North America between raw material depreciation and stop and go? Roughly, how much was that across the three buckets? And then the second question, Carlos, I'd love to get some insight, please. As you think about the business in Europe, clearly there are two big opportunities.
One, reduce the R&D expenditure of the old Fiat brand. Second, to capitalize on the launch of the Doblò in Europe as you launch it on a Peugeot platform. Can you comment, please, on those two opportunities, and how can that basically help your earnings development in 2022? Thank you.
Well, thank you, José. Thank you for your thoughtful questions as always. Let me answer first on the U.S. situation. What we have seen in 2021 is that we are operating in the U.S. under what we would call a pull model instead of a push model as a consequence of the semiconductor supply shortage, as you surely understand. We could leverage this situation in a very efficient way in terms of pricing power while we were fighting against the costs and the inflation on the costs, namely the raw materials. This is what we have been doing, which means somewhere the operating point of the U.S. is moving upwards, better transaction pricing, and I gave you some numbers compared to the other two Detroit competitors w ith, of course, a big fight on the cost side to try to compensate for the raw material cost increase.
We are operating at a point which is quite profitable because we prioritize the most profitable sales and the most profitable channels. While we are doing this, we are operating at a higher transaction price with some kind of cost reduction that could compensate some of the inflation that we are victims of. When we combine the two factors, at the end of the day, we could deliver a record profitability because we were quite fast at enjoying a better pricing while pushing back on some of the costs and compensating with additional cost reductions.
It's a very specific situation which we are in right now, as you can understand from your deep experience of this market. We are enjoying a pull market rather than a push market. The core reason of this are two. The first one is that there is an imbalance between the offer and the demand. The second one is very simply the expertise and the skills and the agility of our North American team, which has been doing a fantastic job in terms of taking the best out of the market. That's what I can right now tell you.
On your final question on the LCVs before I give the floor to Richard, I would say that not only we intend to keep our leadership in LCVs in Europe, and grow our performance in the U.S., and the deal with Amazon is very representative of how focused we are to make some of our major customers happy with the features that we can imagine and engineer. Of course, we have also a global ambition because we are growing at a good pace, and we believe that we can do much more on connectivity, much more on some of the features that make the logistics companies improve their own efficiency. We can bring the zero-emission mobility to those fleets.
The good example next year is the ProMaster EV, which by the way, is leveraging the electrification that already exists on the same van in Europe, and therefore we can go reasonably fast. We will continue to work hard for our LCV business to grow not only on the van sector in Europe, but adding the vans and the pickups all over the world. For that purpose, we intend to give to our LCV business more breathing space so that they can go faster. I don't want to forget a very important point, which is the fact that we are now cutting-edge efficiency on the hydrogen version of our vans.
We are, I believe, the only one that on the same van can offer to the market diesel versions, EV versions, and fuel cell versions, which says a lot about the way we are implementing the technology on those vans. All of this is going to be available for all the brands of Stellantis, regardless of the family where they are coming from. Of course, the efficiency that you can find in one specific brand, you can expect that that efficiency will be expanded and made available for all the brands of our iconic house of brands, including the model that you commented. Richard.
Thanks, Carlos. On the industrial cost bucket, José, I would say that the three biggest effects, obviously there are others that sort of offset, but the two biggest are the inflation effect, which is about EUR 1.1 billion of the EUR 1.7. The inefficiencies on stop-go was about EUR 0.4 billion. And then, extra D&A was about EUR 0.2 for the EUR 1.7 billion of impact. You know, I think clearly there's some opportunity to continue to work on the industrial cost base in North America. As you see, we effectively offset similar issues in Europe to zero. Think that the team is very focused on trying to improve that net performance in North America as we go forward.
I think the other point on the profitability is, you know, we launched the Grand Cherokee, the new one, in H2, basically. In 2022 we have a full year. We launched the Grand Wagoneer, and the Wagoneer basically in Q4, so we have a full year in 2022. You know, there is, I think still some important product news related to those launches and also the second version of the Grand Cherokee, coming in 2022 as well with the two rows. We have, I think some good product news to continue to manage our mix, and our, you know, margin in 2022 as we capitalize on those new cars.
Thank you, Richard. Thank you, José. Let's go to the next question, please.
The next question comes from the line of Michael Foundoukidis from ODDO. Please go ahead.
Yes, hello. Michael Foundoukidis from ODDO . Two questions on my side. First one on synergies. Could you give us maybe more color on what you achieved in 2021 and what were the main buckets? It was an excellent start, but in this context, any idea what we should expect for this year before new platforms kick in? That's the first one. Second question maybe regarding Europe profitability. It was strong, of course, much stronger than what we expected. This was partly thanks to mix and price, but also efficiency gains.
Could you maybe help us understand how we should look at these efficiency gains, maybe between Opel, which is probably still bringing some new synergies, FCA portfolio cleanup, and maybe the cost measures you took at FCA level, and maybe also the old PCD scope, if possible? Thank you.
Two great questions. Thank you. First of all, on the synergies, I would like, as always, that we keep it very transparent, with yourselves and with our investors. It is fair to say that EUR 3.2 billion is a very nice number for the first year. At the same time, I think it's important that we highlight the fact that those were the low-hanging fruits. Therefore, by definition, the low-hanging fruits can be captured fast and strong. I expect the pace of progress to slow down, for a very simple reason, is that, the execution of the synergies is the cement of Stellantis. We want the synergies to be a bottom-up dynamic that translates the fact that our teams understand the sense of what we are doing with this merger.
For me, the most important thing is to make sure that the foundation of Stellantis is sound and is built bottom up. That's the reason why not only I can congratulate our teams for the excellent number for 2021, but I want them to continue to run the show, and I want them to continue to demonstrate that there is a bottom-up dynamic that demonstrates their complete support of this merger. I can expect that it's going to be good. I think it is fair for all of us to consider that the pace may slow down so that we keep it bottom up, and we make sure that we have a very strong foundation for our company.
I think it is in your best interest, in my best interest, it is in our best interest that the foundation of Stellantis is as sound as possible. For this foundation to be sound, it has to be driven bottom up as much as possible. Not only, of course, but needs to be significantly bottom up driven. Do we have more potential? Yes. I will tell you more next week on this matter. I just want to be very clear on the fact that in this year, we were blessed by the low-hanging fruits that we do capture in a very strong and dynamic way. It is also somewhere the consequence of the excellent collaboration that happened prior to the merger and prior to the closing within the teams. The human relationships could be built.
Again, as I said during the presentation, enjoying the diversity as a way to have an even more exciting and rewarding and enriching activity in the company by working with very different people. That's what we are seeing, and I think that's great for the company and that's great for you. I expected it to continue even though the pace may slow down a little bit, so that we continue to build on a strong foundation for the company. On the second topic, it is clear that in Europe there is more potential. There is more potential in Europe in terms of overall efficiency and effectiveness, most probably in the area of the G&A. We see that on the pricing power, most of the brands have done their homework.
You can see that most of the brands are at, if not above, the benchmark in pricing power, which means that they are the new benchmark of the market. Inside of the organization, as we have been historically piling up many different layers of different companies, different brands, it is quite clear when you look at the numbers and when you discuss with the top executives that there is more potential for simplification, for diversity complexity reduction, for increasing the speed at which we go to market, focus more energy on quality and marketing and a little bit less in bureaucratic work. There is potential in terms of G&A for Europe. There is potential to reduce diversity complexity, and there is potential to increase speed. All of this has been identified.
We are going to execute our plans over the next couple of years. Hopefully, we'll see the results. For me, it's premature to tell you what are the magnitudes we are shooting for. Certainly this is the direction in which we are currently working on this matter. Hopefully, this gives you some light on these two matters. Thank you. Let's move to the next question.
The next question comes from the line of George Galliers from Goldman Sachs. Please go ahead.
Yes, thank you for taking my question. The first question was really just on 2021. It obviously was an extraordinary performance, and I think people would have struggled to imagine five years ago a scenario where you reached 16% margins in North America and 9% in Europe, particularly when we consider some of the assets in that base in addition to PSA. However, some investors do feel that 2021, from an industry perspective, was as good as it gets due to the price mix evolution from the shortage of vehicles, despite the very low industry volumes. Out of interest, would you classify 2021 as a year which was as good as it gets from an end market development perspective? The second question I had was just on your end market prognosis for 2022.
Obviously, you're seeing most of your main markets growing at a rate of around 3%. That seems a little conservative. Perhaps you could give some insight into why only 3% and what you think prevents stronger growth. As a company, do you expect to do a little better than 3% on your wholesales from an internal planning perspective? Thank you.
Well, those are great questions. Let me try to answer. On the first one on North America, I just would like to tell you that we are not shy of things we would like to improve. Being cost, being marketing, being quality. We have identified with the North American management team a lot of things we can improve, and it's a rewarding experience, a refreshing experience to see that there are things that we could do better. Why? Because we have such a very large open book for internal benchmarking in Stellantis that there is always somebody in the company that is doing a better result than you are in any given part of your P&L.
That is giving us a huge internal benchmarking lever that our top executives are aggressively embracing to improve things in their own region or in their own brand. This has been working very well because, fortunately, we have been able to keep an open-minded attitude inside of the top leadership team, which is only focused at improving the company and not being defensive on any kind of topic where we could find in the company a better performance. We are not shy on the list of things we can do better in North America.
At the same time, I think it is fair, and I think you hinted that, to consider that the current conditions in North America are very positive for the margins. Because we have this significant imbalance between the offer and the demand, which then creates what we call a pull market instead of a push market, and we both know that those are very good conditions to improve the profitability margins in a given market. This is a situation in which we are now, but we are not the only ones. Our competitors are in the same, enjoying the same position, and then you can compare, you the investor, who is doing the better job just looking at the margins. From the metrics that I have access to, the winner is obviously Stellantis in North America, by far.
That's good for them, and it's warm congratulations to our North American team. Of course, our strength is to be able at the same time where we congratulate them to be putting our energy, our time, and our focus on the things that we can do better, thanks to the internal benchmarking. That's what I would tell to you on the North American current situation. What was the other question? I forgot.
Growth of 3%.
The 3%.
Is that conservative?
Yes, the forecast. Well, I think we have to be very humble on the outlooks. We are not very good at making outlooks. Historically, we see that we are often wrong. Anyway, as you know well, right now, the size of the markets will be mostly managed by the supply of semiconductors. The size of the market is going to be somewhere the consequence of that supply. That expresses the fact that we believe that the situation is going to move in the right direction, but we also believe that it's going to be very slow. That's what those numbers mean for us is, yes, hopefully things will get a little bit better, but we believe it's going to be very slow.
It will take time, and 2022 is not going to be from that perspective the year where we can say we are back to normal. We don't think that that will happen. On top of the pure semiconductor problem, we have of course the raw material cost inflation, which is going to create additional hurdles to be overcome. Of course, it's normal that we mention geopolitics of the world, which have not been very helpful in the last years, and they don't seem to be becoming better this year. We are not at all pessimistic because we have enough on our plate to improve the efficiency of the company.
The way we have been working intensively on the long-term strategic plan is very helpful to see where are the areas and the pockets of things that we could and should be doing better. We have tons of things that we can improve. At the same time, we are facing the headwinds that you know, if you seem to consider that we are quite cautious on the outlook, from our side, we would answer that most probably it's because we see an improvement on the semiconductor supply front, but still a very small and very low pace improvement. I think that's the best answer that we can give you on this matter. Next question, please.
The next question comes from Thomas Besson from Kepler Cheuvreux. Please go ahead.
Thank you very much. It's Thomas Besson at Kepler Cheuvreux. I have two questions, please. The first one is about cash returns. I mean, you've generated a much stronger amount of cash than initially anticipated in 2021. You're proposing to return EUR 3.3 billion via dividend, a bit less than 25% of your earnings. Is it reasonable to think that a buyback may eventually complement dividend in the coming months if your share price remains depressed in terms of valuation? Or is it something you prefer to discuss next week? Second, you achieved extraordinary results for 2021, but still, you've decided to change your distribution agreements in Europe and try to get as well new agreements with suppliers, at least in North America.
Can you update us on these and explain to us why you are still pushing so much for margin improvement while you are way above the competition? I know the sense of performance is always there for you. Maybe you could explain to us already what allowed Stellantis to improve in all regions in H2, while most of your direct competitors in North America or with Chinese exposure in particular had a deterioration of their operating performance. Thank you. What do you see maybe coming that the others may not see as well as you do? Thanks.
Well, thank you, Thomas. Great questions indeed. A couple of comments. I will give the free cash flow question to Richard. He will give you more details as it relates to dividend policy. We will talk to you about this next week in more details. It is a sensitive matter that needs some explanations. I just want to tell you that we consider that the cash of the company is owned by the shareholders. Either we have a very strong project to propose, and we have, as you will see next week. If there is availability and a strong liquidity position, which is our case, there is no reason why we would not give the cash back to our shareholders, which I think is fair.
They are the owners of the company. That's how we think about things. Certainly next week we are going to be talking about that. For the free cash flow question, I will hand over to Richard. On your second question, which is about why do we keep pushing as much as we are? I think the fair answer is that I have learned from my 40 years of automotive life that as soon as you stop pushing, you go backwards. Because as you know well, Thomas, this is a competitive game. It is all about being better than the other guys at the end of the day. If you stop pushing, then you go backwards because the other guys are pushing. They may not be pushing as much as you are, you never know, but they are pushing anyway.
If you stop pushing, then you go backwards. For us, the big gorilla in the room is the cost of electrification. That's the big gorilla in the room. We can expect electrification to represent an additional total production cost of around 40% to 50% against a conventional vehicle. There is no way we can transfer 40% to 50% additional total production cost to the customer, because if we do so, we will lose the middle classes and our customer bases will shrink. We cannot do that. At the same time, we cannot keep the same pricing with that cost because of course, we will go in the red and we'll have to restructure the company. The only way to move forward is to absorb those 50% of additional cost.
If we say that we do it from now up to 2026, because we told you at the Capital Day that from 2026 we would be ready to commit on a double-digit AOI margin. If we have to do it over the next few years, then that means around 10% productivity per year for the next five years. In an industry that is used to deliver, as you know, Thomas, between 2% to 3%. How do you go from 2% to 3% per year to 10% per year? There are not many different ways to go there. One of the ways is to reduce your distribution cost, improve the quality to the final customer, improve the fact that you can connect with the final customer.
At the same time, while you are improving the quality of the customer journey, you reduce the cost of distribution. It's a strong contributor for the absorption of the electrification cost. It's not the only lever. We have others that we can comment next week. This is to say that one of the reasons why we didn't stop discussing with our partners about how can we improve the quality of the customer journey while reducing the cost of distribution, we didn't stop, and we are now progressing very well in Europe. I believe that we will reach an agreement that will be supportive of achieving a double-digit AOI margin in a fully electrified world while making sure that we do not lose the middle classes which represent a significant part of our customer base.
That's what we are trying to do, and that's why we don't stop pushing. You know our D&A. We are competitors, and we are here for the race. Thank you, Thomas. Richard, on the free cash flow, please.
Thank you, Carlos. Well, I think you basically answered the question. I think on capital allocation, we'll be talking about it on March 1. I think on the payout of the dividend, I think we're very satisfied with being able to propose to the board, and the board agreed. Therefore, obviously subject to the shareholder approval, we're pleased with the EUR 3.3 billion payout. We'll look at the rounding to see if it's a precise 25.0, Thomas, but I think it's basically not far off. I think we're at 25% as a first payout for Stellantis, which I think is very respectable. You know, hopefully will be seen so by shareholders and investors, and then we'll move forward. We'll give you more visibility on overall thoughts on capital allocation on March 1.
Thank you, Richard.
Thank you.
Next question, please.
The next question comes from the line of Philippe Houchois from Jefferies. Please go ahead.
Thank you very much, and good afternoon. I've got two questions, please. One maybe for Richard is, I'm looking at the size of your adjustments now with EUR 1.7 billion last year or 2020, EUR 2.7 billion in 2021. What's the direction there? Because some of those adjustments, it's hard to know how much they're really non-recurring, how much they're things like the valuation warranties. I think it'd be interesting to get your views on where we're going in terms of the size of adjustments and future visibility on this. The second one, thank you very much, Carlos, for you. I know you've been vocal about affordability and but I'm still looking at the cost of electrification is definitely one.
This year and next, possibly, raw materials are going up, logically, nominal prices of cars have to go up if you wanna maintain your margin. Interest rates going up, real values aren't going to improve much. They may be stable, but they may also come down. That makes affordability with lots of multiple headwinds. I'm just wondering, you know, y ou talk about distribution, but that's gonna be, you know, it's gonna take several years, and I'm curious about what you're doing with some of your suppliers, where you seem to be very, very strict about requiring that they give back to you any productivity gains. Are there any levers, or are you taking the risk that you're going a bit far with your suppliers? Thank you.
I think your understanding is absolutely perfect on the second topic. I will answer the second question, then leave the first one to Richard. On the second one, we have to come back to some basics that of course you know as good as I do, which is the fact that on the total production cost of an automobile today, just before you put the car on the trailer to ship it to the dealer, 85% of the total production cost of an automobile is made out of bought out parts. This is the situation that has been created over the last 30 years in the automotive industry. Of course, our suppliers could enjoy this activity for the last 30 years.
It happens that in such a cost structure, if you have 85% of the total production cost, which is made out of bought out parts, there is no surprise that when you have to absorb 50% of additional costs coming out of electrification, your suppliers need to be a significant contributor for this additional productivity, because they have been enjoying a significant business over the last 30 years with this kind of cost structure. Yes, they have to contribute, and some of them are contributing in a very efficient and partnership-oriented way. What does it mean? It means that in this transformation of the industry, it's not only about the OEMs, it's also about the supplier base.
As you know, there is significant competition in the supplier base, and that is going to be also a very nice Darwinian transition period for our suppliers as much as it is for the OEMs. It means that we are in the same boat. We are in the same transformation. The speed is imposed on us by the regulations. Of course, it means that we are going to keep what I believe is a strong differentiator of Stellantis, and it has been formerly for the two families that created Stellantis, which is keeping a very low breakeven point. Because if at any point in time we cannot generate enough productivity to absorb the additional cost of electrification, and we cannot pass everything to the consumer, but we can pass something to the consumer, perhaps that the total markets will go slightly down.
The guys who are going to be able to manage this are the guys who have the lowest breakeven point, and we are those guys. We will keep a very low breakeven point because we have 30% more efficiency than our peers when we spend R&D and CapEx. We are more efficient. We are sharper on costs, sharper on fixed costs. We try to enjoy a strong pricing power at benchmark level. We keep the breakeven point very low because in this process of absorbing 50% of additional cost, we can contribute, and we will contribute significantly as the OEM. We need our suppliers to contribute. At the end of the day, what is left is some part of it will be transferred to their customer.
It may have an impact on the size of the market, and the guys who are going to be able to digest that are the guys who have the lowest breakeven point. From that perspective, 2021 is very good concrete example of that because we did 6 million cars. Our potential, as you know well, is above eight, and we delivered 11.8% AOI margin, north of EUR 6 billion of positive free cash flow with 6 million cars in a car company that could do more than eight, which demonstrates to which extent our low breakeven point is protecting the company and protecting our investors. That's why some of your teammates were talking about all-weather company. Yes, to a certain extent, Stellantis is an all-weather company.
One of the things that is, I think, a differentiator is that, of course, we need to push. It's not always spontaneous. To a certain extent, this company likes change. This company likes to put itself in a dynamic of change because we don't get bored, when things are changing, and it gives us more opportunities to grasp a different business and be even more competitive vis-à-vis our peers. Your point is valid. This is going to be mostly a cost reduction race over the next five years to protect affordability in terms of protecting the size of the market, so that we can keep the middle classes on board on new car sales. I think it's very important not only for the car companies, but also for the social stability of the Western societies in which we operate.
I think that's very important that we protect freedom of mobility for the middle classes. This is what I can comment to your fair question, and I will give the floor to Richard for the other one.
Thanks, Carlos. Hi, Philippe. I think we're looking at two relatively unusual years. Let's hope. 2020, obviously, the charges we had on unusuals were largely related to impairments due to COVID and issues related to some of the product that we looked at going forward in, largely in FCA, frankly, in 2020. In 2021, obviously, if I look at the 2.7, about EUR 1.5 billion are non-cash items related to PPA for EUR 0.5 billion of inventory, warranty policy alignment for EUR 0.7 billion, which again is a non-cash item. We have two companies that have different practices, and from an accounting estimate point of view, we need to move forward in a consistent manner.
EUR 0.3 billion of some impairments on some old vehicle lines, frankly, mainly from the ex-Opel side of the house as that product lineup basically comes towards an end. EUR 1.5 billion is non-cash charges, largely related to the merger. We have, you know, a remainder of about EUR 800 to EUR 900 million, which is restructuring in a more traditional sense of the word, and also, you know, related to these transactions that have occurred in the past for both ex-PSA and ex-FCA.
I would imagine that going forward, we are likely to continue to have some level of restructuring going through the restructuring line of EUR 0.5 billion-EUR 1 billion, depending on the year in the short term, coming down over time. I would not expect to have the same level of non-cash charges that we had in 2020 for some of the events there in 2021 related to the merger.
Thank you, Richard. Let's take one more question as the time is flying. Please.
The next question comes from Horst Schneider from Bank of America. Please go ahead.
Good afternoon, and thanks for sneaking in also my question here. The most important one that I have that relates to your market cap. I checked it again this morning. In 2021, you probably generated an adjusted EBIT similar to the one of the Volkswagen Group. Your market cap is just 40% of the Volkswagen Group. We see at the moment that Volkswagen Group has embarked on or is likely to embark on financial engineering and is gonna to dispose assets. I just want to understand how you think about valuation of Stellantis and would you also consider financial engineering measures maybe to increase the valuation of the company?
The last question that I have, or second question that I have that relates more again to the one from George Galliers on volumes, what would you do if transaction prices get worse in the U.S., if incentives gonna increase in the U.S., would you rather then cut back on volumes or would you say, "No, it's still a great margin. Volumes are more important. We need to keep market share"? What is your preference? Thank you.
Well, thank you. Those are really great questions. I would be pleased to answer them much more next week than this week, of course. I would just comment that you are possibly right that right now Stellantis is cheap. It's a good opportunity for the investors because I am absolutely convinced that what we have had offered is very exciting, and you will see it through our plan next week. Yes, Stellantis is quite cheap. Why is that? Possibly because we have not been good enough, and I have not been good enough at communicating to you the exciting plans that we have for the company. We have tried to correct that with the Electrification Capital Day, with the Software Capital Day.
We will present to you the plan in an extensive manner next week. Hopefully, you will be convinced, but surely Stellantis deserves a much better market cap. That's for sure. It's a very obvious opportunity for investors. We have demonstrated that we are in our DNA an all-weather company. We have demonstrated that we like change, and therefore we are not afraid of steering the company towards a tech mobility company in any way. We have demonstrated that we are not afraid of new technologies. We have demonstrated that we are able to make partnerships with tech companies at a high pace. All of this has been done for you the investors to enjoy opportunities. Now, the decision is in your hands, not in mine.
My job is to ensure that we are creating value and that we are ensuring the sustainability of our company through the different challenges that we have ahead. I'm absolutely convinced that we have everything we need. I am absolutely convinced that we have a fantastic team, and I'm absolutely convinced that with the very clear and rigorous governance that we have in our company, we can ensure the proper stability for the management to execute the plans. You were asking if we had some specific financial operations that we could do. I don't expect that to happen in the first years of the plan, but it's still a possibility that we cannot disregard and that we should not disregard based on the great things that we are now building.
Those great things in a few years may represent big opportunities to unleash additional value for our shareholders, and we should not, and I do not exclude that. So far, it's not the core of our plan. The core of our plan is to explain to you how we are steering the company towards a tech automotive company, how we are positioning ourselves to grasp more profitable opportunities. I think we have, as you will see next week, tons of things that we can do, and hopefully, you will be convinced not only by the numbers, but also by the clarity of what we want to do. With this, I would like to thank you all for the very thoughtful questions that you are raising always.
I would like to tell you that, as the CEO of this company, I'm very confident. I don't generally speak without being well-grounded on realities that I can see inside of the company. I think that Stellantis was a great move. It's a winning move. Stellantis has a great potential, and I think it is fair to our people to say that we cannot do everything in one single year. It is fair to tell them that what they have already achieved on the first year through the accumulation of the three layers that I have described is already quite immense.
I would like to thank you, the investors, for your trust, for your thoughtful questions, and I would like to convey to my people my warm thanks and sincere congratulations for what they have achieved on the first year of Stellantis. Thank you very much, and see you hopefully next week. Bye-bye.