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EV cost burden pushing automakers to their limits, says Stellantis' CEO Tavares

DETROIT — Stellantis CEO Carlos Tavares said external pressure on automakers to quickly shift to electric vehicles potentially threatens jobs and vehicle quality as producers struggle with EVs' higher costs. Governments and investors want car manufacturers to speed up the transition to electric vehicles, but the costs are "beyond the limits" of what the auto industry can sustain, Tavares said in an interview at the Reuters Next conference released Wednesday. "What has been decided is to impose on the automotive industry electrification that brings 50% additional costs against a conventional vehicle," he said. "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 counter productive. It will lead to quality problems. It will lead to all sorts of problems," he said. Tavares said Stellantis is aiming to avoid cuts by boosting productivity at a pace far faster than industry norm. "Over the next five years we have to digest 10% productivity a year ... in an industry which is used to delivering 2 to 3% productivity" improvement, he said. "The future will tell us who is going to be able to digest this, and who will fail," Tavares said. "We are putting the industry on the limits." 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 both establishment automakers such as GM, Ford, VW and Hyundai, as well as start-ups such as Tesla and Rivian. The latter electric vehicle companies are far smaller in terms of vehicle sales and employment. But investors have given Tesla and Rivian higher market valuations than the owner of the highly profitable Jeep and Ram brands. That investor pressure is compounded by government policies aimed at cutting greenhouse gas emissions. The European Union, California and other jurisdictions have set goals to end sales of combustion vehicles by 2035.

Autoblog Podcast #372

Episode #372 of the Autoblog podcast is here, and this week, Dan Roth and Chris Paukert are joined by Peter Leung of RichlandF1 to talk Formula One, the impending demise of Bertone, and Honda spinning Acura off into its own division. We start with what's in the garage and finish up with some of your questions, and for those of you who hung with us live on our UStream channel, thanks for taking the time. Check out the new rundown below with times for topics, and you can follow along down below with our Q&A. Thanks for listening! Autoblog Podcast #372: The video meant to be presented here is no longer available. Sorry for the inconvenience. Topics: Bertone goes bust Mercedes F1 Power Unit Honda spinning off Acura In the Autoblog Garage: 2014 Jeep Cherokee Limited 2015 Subaru WRX STI 2014 Land Rover Range Rover Autobiography Hosts: Dan Roth, Chris Paukert Guest: Peter Leung Runtime: 01:37:41 Rundown: Intro and Garage - 00:00 Formula 1 - 26:39 Bertone - 50:42 Acura - 01:02:19 Q&A - 01:14:38 Get the podcast: [UStream] Listen live on Mondays at 10 PM Eastern at UStream [iTunes] Subscribe to the Autoblog Podcast in iTunes [RSS] Add the Autoblog Podcast feed to your RSS aggregator [MP3] Download the MP3 directly Feedback: Email: Podcast at Autoblog dot com Review the show in iTunes Design/Style Marketing/Advertising Motorsports Podcasts Acura Honda Jeep Land Rover Subaru

Car Club USA: Louisiana Mudfest

There's nothing quite like mudding. Big tires, huge power, and crazy-wild gearheads that like to throw down on a mud pit almost as much as a thirty rack of Coors. In the latest, and some might argue greatest yet episode of Car Club USA, we head to Louisiana to throw some dirt at Mudfest. As Louisiana's one and only Mouth of the South puts it, "If you don't mud ride... go to Texas I guess." Joining The Mouth and friendly rivals The Most Hated Mud Sluts, we dive in. Beyond the obvious V8 blasting and tractor-tire spinning, those who know best describe Mudfest as, "Good cooking, good friends, good fun, and a lot of partying." It's a motorsport spectacle unlike any you're likely to find up North or out West, though no less impressive to behold. Follow along with the fun, the impromptu drag racing, the trash talking, and the mechanical madness. And find out why, at Mudfest, "if we don't tear it up, we ain't done it right." Each Car Club USA episode features a different car club or event from across the US, where passionate owner communities gather to share automotive experiences and embark on incredible adventures. From Main Street cruises to off-road trails, catch all the latest car club activity on Autoblog. Chevrolet Ford Jeep RAM Truck Off-Road Vehicles Car Club USA Videos autoblog black