Stellantis CEO: EV Deceleration is a 'Big Trap'
Stellantis CEO Carlos Tavares has issued a strong warning to automakers, calling any deceleration in the transition to EVs a "big trap."
He explained that a slower shift to EVs would compel manufacturers to invest significantly in both electric and internal combustion engine (ICE) vehicles.
According to Carlos, this would lead to costly consequences, as automakers would be forced to maintain a dual-investment strategy for an extended period, creating a significant financial burden for the industry.
"When you make a longer transition, in fact, you don't replace the old world with a new one. You add up the new world to the old."
Stellantis, a European automotive giant with brands like Chrysler, Vauxhall, Jeep, Maserati and Peugeot, is currently navigating a challenging market where EV sales have slowed, particularly in Europe.
Carlos' remarks highlight his belief that delaying the transition could have severe repercussions for automakers trying to balance new and traditional technologies.
Challenges in the European EV market
The European auto industry is facing several obstacles to boosting EV sales. One of the primary challenges is the high cost of owning an EV compared to traditional ICE vehicles.
In Germany, the largest car market in Europe, the price of an EV remains about 20% higher than that of a petrol car, even after subsidies are taken into account. The cost disparity is a significant deterrent for consumers, contributing to the slowdown in EV adoption.
Moreover, the recent reduction of EV subsidies, particularly in Germany, has added to the decline in sales. Europe's broader economic stagnation, like Germany teetering on the edge of recession, has further impacted overall car sales, including EVs.
Rising competition from China
Another major challenge facing European automakers is the growing competition from Chinese EV manufacturers. Chinese brands, such as BYD, a prominent rival to Tesla, have rapidly increased their presence in the European market.
The share of EVs sold by Chinese companies in the EU has surged from just 0.4% of the market in 2019 to nearly 8% by 2023.
In response to this competition, the European Union recently imposed tariffs of up to 35.3% on EV imports from China.
EU officials have claimed that the rise of Chinese EVs in the market has been fueled by "unfair subsidisation" from the Chinese government, allowing Chinese-made vehicles to be sold at significantly lower prices than their European counterparts.
The move aims to protect Europe's domestic automakers from being undercut by lower-cost Chinese imports.
Stellantis leadership shakeup
Carlos' warning about the EV transition comes as Stellantis undergoes a major leadership reshuffle.
Carlos recently announced that he will step down as CEO in early 2026 when his contract expires, ending speculation about a potential extension. The announcement comes from declining profits for Stellantis, with net earnings down nearly 50% in the year's first half.
In addition to Carlos' planned departure, Stellantis has introduced several executive changes, including the appointment of Antonio Filosa as North America's Chief Operating Officer, Jean-Philippe Imparato as Chief Operating Officer for Enlarged Europe, Doug Ostermann as Chief Financial Officer and Santo Ficili as CEO of Maserati and Alfa Romeo.
Work-from-home policy reversed
In another strategic shift, Stellantis has reversed its previous 70% work-from-home policy, calling for employees to return to the office on average three days a week.
Carlos, a strong advocate for the change, cited "unprecedented uncertainties and heightened competitive pressures around the world" as critical reasons for the decision. Stellantis plans to revamp its workspaces to accommodate the increased in-office presence, foster greater collaboration and improve productivity.
As Stellantis navigates this period of transformation, Carlos' remarks serve as a clear warning to the industry: any delay in the EV transition could leave automakers stuck in a costly and unsustainable position, struggling to invest in both legacy technologies and the future of electric mobility.
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