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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.

Work at a Chrysler dealership, get free college education

The cost of a college education in the US can put a student tens (hundreds, in some cases) of thousands of dollars into debt. FCA US wants to give its dealership employees a leg up, though, and the automaker is now offering a completely free education to them through a partnership with Strayer University. The workers can take any of the college's classes online or on campus through program called Degrees@Work. Currently, the offer is only available to employees Chrysler, Jeep, Dodge, Ram and Fiat dealers in the automaker's Southeast region, which includes Florida, Georgia, South Carolina, North Carolina, Alabama and Tennessee. However, a national expansion will happen before the end of the year, Strayer spokesperson Cristina Henley tells Autoblog. The program will cover all of the students' expenses, including their books, according to Henley. FCA US sees this partnership as a way to improve the talent of its workforce, retain employees longer and possibly attract people wanting to take advantage of this free education. "Many of our dealers have expressed concern over the availability of talent to fill open positions due to business growth and turnover in their stores, especially in metro markets," Al Gardner, the company's Head of Dealer Network Development, said in the Degrees@Work announcement. Strayer has about 40 programs available, including in business administration, accounting, marketing, and more, and the university offers associate's, bachelor's, and master's degrees. It will also give FCA US employees credit for their work experience to get them a diploma even more quickly. FCA US Dealers to Offer Employees No-Cost, No-Debt College Education FCA US teams with Strayer University to develop first-of-its-kind dealer program Degrees@Work program open to all employees of participating dealerships Employees can earn no-cost, no-debt degree through Strayer University All Chrysler, Jeep®, Dodge, Ram and FIAT dealerships may participate First phase of program rollout begins with dealers in the FCA US Southeast Business Center National rollout expected later this year May 4, 2015 , Auburn Hills, Mich. - Employees of Chrysler, Jeep®, Dodge, Ram and FIAT dealerships will have the unique opportunity to earn a no-cost, no-debt college degree through Strayer University's Degrees@Work program, developed in collaboration with FCA US LLC. FCA US is the only company in the automotive industry to offer the program.

Chrysler recalling nearly half a million Durangos and Grand Cherokees

Rule number one of public relations – save the bad news for Friday. Fiat Chrysler has adhered to that, announcing today that it'd be voluntarily recalling 467,480 SUVs. This latest recall could actually be thought of as a continuation of a September 2014 recall, relating to the fuel-cell relay. In that case, some 188,723 Dodge Durango and Jeep Grand Cherokee CUVs from model year 2011 were recalled. And this time, it's the Durango and GC in trouble again. FCA is adding crossovers from model years 2012 and 2013 to the fuel-pump recall, although only diesel-powered Jeeps with the 3.0-liter V6 that were sold outside of North America are affected this time around. As with the previous recall, deformities in the fuel-pump relay, which could affect its functioning. In most cases, FCA reports that the affected vehicles simply won't start, although they also could be prone to stalling. A new relay circuit will be installed that promises increase durability. Of the 467,480 vehicles being recalled, 338,216 were sold in the US market, 18,991 went to Canada and 10,829 were shipped south of the border, to Mexico. Outside of the NAFTA region, FCA is recalling 99,444 vehicles. No injuries or accidents have been associated with this recall. Statement: Fuel-Pump Relay February 27, 2015 , Auburn Hills, Mich. - FCA US LLC is voluntarily recalling an estimated 467,480 SUVs worldwide to install new a relay circuit that improves fuel-pump relay durability. FCA US engineers have determined a condition identified in a previous investigation may extend to additional vehicles. The previous investigation, which led to a recall, traced a pattern of repairs to fuel-pump relays that are susceptible to deformation. This may affect fuel-pump function, preventing a vehicle from starting, or leading to engine stall. Of the two scenarios, the no-start condition is the more common. FCA US is unaware of any related injuries or accidents. The fuel-pump relay is located inside the Totally Integrated Power Module (TIPM), which also helps manage other vehicle functions. None of these other functions, including air-bag deployment, is affected by the fuel-pump relay. The new campaign affects an estimated 338,216 vehicles in the U.S.; 18,991 in Canada; 10,829 in Mexico and 99,444 outside the NAFTA region. Covered are model-year 2012 and 2013 Dodge Durango full-size SUVs and non-NAFTA 2011 Jeep Grand Cherokee mid-size SUVs equipped with 3.0-liter diesel engines.