Electric vehicles cost the company 50% more, “beyond the limit” of what the industry can sustain

Stellantis CEO Carlos Tavares said in an interview with Reuters published on Wednesday.

Tavares adds that electric vehicles bring in a 50 percent additional cost over internal combustion vehicles, adding that there is “no way” that the added cost could be passed on to consumers in the form of higher prices. , because it would make new cars unable to afford a large chunk of the buying public.

Automakers can charge higher prices and sell fewer cars, or accept lower profit margins, both of which will lead to job cuts, Tavares said.

Muscle Car and Dodge EV Platform – Stellantis EV Date 2021

Despite this bleak description from the head of one of the largest automakers, Tesla and Rivian have enjoyed high market valuations, Reuters noted. While Tesla aspires to be a truly mass-market automaker, both companies’ business models are currently based on selling a relatively small number of vehicles at high prices and promising future growth. future for investors.

Industry analysts have predicted a steady decline in electric vehicle prices thanks to falling battery costs, but recent report from Bloomberg New Energy Finance (BNEF) could reverse that trend. BNEF predicts battery prices could rise in 2022 due to supply chain issues.

Ram 1500 BEV and Platform – Stellantis EV Date 2021

Stellantis is the product of a merger between Italy-US Fiat Chrysler Automobiles (FCA) and France’s PSA Group. While the FCA relies on Tesla’s emissions credits, the former PSA business has done enough with the electric cars that Stellantis reported as not going to.

Even as Tavares complains about the cost, Stellantis is moving to electrify legacy FCA brands. An all-electric Ram 1500 pickup and a Dodge muscle car are both are due in 2024. Stellantis is also growing dedicated EV platform and propulsion system.

Along with Mercedes-Benz, Stellantis is also investing in Factorial Energy for solid-state battery technology, may begin to be offered in some niche models later in the decade.