EV Slowdown Would Be ‘Big Trap’, Warns Stellantis CEO
Stellantis CEO Carlos Tavares has warned that any slowdown in the transition to electric vehicles would be a “big trap”.
Speaking to the Financial Times at the Paris Motor Show on Monday, Tavares said slowing down the transition would mean automakers having to invest in both EVs and combustion-engine vehicles.
Stellantis is the European automaker that owns brands such as Chrysler, Vauxhall, Jeep, Maserati and Peugeot.
"When you make a longer transition, in fact, you don't replace the old world by the new one. You add up the new world to the old,” he told the Financial Times.
The European auto industry is facing a number of challenges to selling EVs. Currently, the total cost of owning an EV in Europe supersedes that of an internal combustion engine vehicle (ICE).
In Germany - Europe’s largest car market - for example, EV prices remain roughly 20% higher than comparable petrol cars, even after accounting for subsidies.
The retraction of attractive EV subsidies, particularly in Germany, has also contributed significantly to a decline in sales, as well as Europe's economic stagnation with Germany on the brink of recession, impacting overall car sales including EVs.
Competition from China
European EV makers are also facing competition from their Chinese counterparts, with several auto chiefs having stated their concern about the rise of Chinese automakers such as BYD - a key rival of Tesla in the EV space.
The number of EVs sold by Chinese brands in the EU rose significantly, from just 0.4% of the total EV market in 2019 to almost 8% in 2023, helping to prompt the EU to impose tariffs of up to 35.3% on EVs from China from early this month.
EU officials claimed that the rise in Chinese EV imports was boosted by "unfair subsidisation" from the Chinese government. This allegedly allowed China-made EVs to be sold at much lower prices than those produced in the EU.
Major shakeup for Stellantis
Tavares’ comments follow Stellantis’ announcement that he will be stepping down in early 2026 when his current contract expires.
The announcement puts an end to speculation about a potential contract extension for Tavares, and follows the company experiencing declining profits, with net profits down nearly 50% in the first half of this year.
Tavares has faced criticism from dealers and unions, particularly in the United States, over issues concerning inventory management and high prices, leading to backlash from dealer councils.
Alongside the announcement of Tavares' retirement, Stellantis has made several other executive changes resulting in a major leadership shakeup:
- Antonio Filosa appointed as North America Chief Operating Officer
- Jean-Philippe Imparato named Chief Operating Officer for Enlarged Europe
- Doug Ostermann appointed as Chief Financial Officer
- Santo Ficili becomes CEO of Maserati and Alfa Romeo
Cutting back on WFH
The company has also reversed its 70% work-from-home policy, as it called for its staff to work in-office three days a week on average.
This change aims to increase face-to-face collaboration and potentially improve productivity. To accommodate the return of employees, Stellantis says it is planning to revamp its work spaces.
The reversal of the work-from-home policy is championed by Carlos Tavares, who has cited "unprecedented uncertainties and heightened competitive pressures around the world" as a factor in recent company decisions.
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