Automotive News Europe — 2024-01-19
Automotive Industry
Stellantis will avoid being caught in a price war which would destroy its profitability, CEO Carlos Tavares said.
The automaker, which is among the most profitable in the industry, is protected against a downtrend in prices, which could put several competitors "in trouble" and at risk of becoming takeover targets, Tavares said.
"If you go and cut pricing disregarding the reality of your costs, you will have a bloodbath. I am trying to avoid a race to the bottom," he said on Friday 19 January during a presentation of Stellantis' new platform for large battery-electric vehicles.
"I know a company that has brutally cut pricing and their profitability has brutally collapsed," Tavares added, without elaborating.
Earlier this week, Tesla slashed prices of its Model Y car across Europe, a week after the company cut prices in China in the face of uncertain electric-vehicle demand.
US, EU elections
Tavares also said that elections in the US and Europe this year will dictate how quickly he can execute his €30 bn investment plan in electric vehicles. Spending will either accelerate or slow down pending who gets elected, he said.
"I have no scenario for the fact that it would stop, because we need to fix the global warming issue," he said.
Stellantis has been slower to introduce new EV models to the US than its Detroit rivals. Its first full-electric Jeep SUV and the electric Ram pickup will reach the US this year.
Ford and General Motors have delayed EV investment in recent months as American car buyers have cooled on EVs, balking at the high prices and a spotty charging infrastructure.
US President Joe Biden, who had made speeding EV adoption a centerpiece of his agenda, trailed former President Donald Trump by 5% points among registered voters in seven swing states in a Bloomberg News/Morning Consult poll last month.
Automakers are pushing back on the Biden administration's efforts to increase fuel economy, saying stricter rules would cost them billions in fines.
In Europe, elections taking place in June also could pose a risk for electric vehicle adoption if the bloc's new parliament decides to further water down EV regulation.
Last year, Germany's lobbying to include e-fuels in the EU's regulation to effectively ban new sales of combustion-engine cars by 2035 nearly derailed the legislation.