Stellantis Group CEO, Carlos Tavares said the external pressure — from the government and investors — to rush the transition to EV cars will cost jobs. Most automakers can’t do it by 2030.
The costs are insane at 50% more to produce. Given the fact that average Americans in huge areas of the country make $56,000 annually, it will keep them out of the market. Additionally, what about the costs of transporting food and goods? Truckers have already said it’s unfeasible.
“What has been decided is to impose on the automotive industry electrification that brings 50% additional costs against a conventional vehicle,” Tavares told Reuters.
It’s “beyond the limits” of what automakers can do.
“There is no way we can transfer 50% of additional costs to the final consumer because most parts of the middle class will not be able to pay.”
Automakers could charge higher prices and sell fewer cars, or accept lower profit margins, Tavares said. Those paths both lead to cutbacks. Union leaders in Europe and North America have warned tens of thousands of jobs could be lost.
Automakers need time for testing and ensuring that new technology will work, Tavares said. Pushing to speed that process up “is just going to be counterproductive. It will lead to quality problems. It will lead to all sorts of problems,” he said.
The prediction is the US and China markets will be 50% EV by 2030.
Electric vehicle costs are expected to fall, and analysts project that battery electric vehicles and combustion vehicles could reach cost parity during the second half of this decade.
Like other automakers that earn profits from combustion vehicles, Stellantis is under pressure from electric vehicle maker Tesla Inc (TSLA.O) and other pure electric vehicle startups such as Rivian (RIVN.O).
Investors and government policies push their valuation up beyond what it’s worth.
Democrats want everyone except the elite out of their cars so it works for them. There is also the question of how many people want an EV. So far, not many people.