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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.

FCA adds Apple CarPlay and Android Auto to Uconnect

Fiat Chrysler Automobiles has three showcases ready for this week's Consumer Electronics Show. The spotlight reveal is a "glimpse" of the fourth-generation Uconnect system, which now gets Apple CarPlay and Google's Android Auto. They lead the advances due to be rolled out this year, which include beefier internals for faster startup and processing, the next evolution of the Uconnect navigation system, capacitive touchscreens, and higher resolution screens. Going beyond the vehicle, a concept display will present solutions to help drivers achieve "Car. Life. Balance." That means, as we've heard before, a car that knows what you want before you realized you wanted it via monitoring your driving habits, communicating with other vehicles and traffic infrastructure, and prioritizing information in certain situations to keep the driver from being overwhelmed. A Waze-like community of road knowledge is also on the menu, and it allows for tagging of tag street conditions to inform other vehicles, and a follow-me mode where people can "request to follow other vehicles." Government types will want to scope out the 2016 Dodge Charger Pursuit with an exclusive Uconnect system boasting a 12.1-inch screen and enhanced resolution that can speak to the officer's mobile computer. Have a read of the press release below for more details. FCA Announces New Fourth-Generation Uconnect® Systems at 2016 Consumer Electronics Show in Las VegasLatest technology advancements help provide Car. Life. Balance.• Uconnect team announces fourth-generation Uconnect systems featuring improved performance; Apple CarPlay and Android Auto™ will be available globally in select models during 2016• CES attendees will experience a digital technology concept display that explores future intelligent transportation• FCA exhibit to feature concept brought to reality, the Uconnect 12.1-inch built-in touchscreen that enables integration of law enforcement computer systems with the industry standard Uconnect touchscreen systemJanuary 4, 2016 - Fiat Chrysler Automobiles N.V. and its subsidiary FCA US LLC are heading to the 2016 Consumer Electronics Show (CES) in Las Vegas with a display featuring the latest technology advancements in FCA vehicles and will provide a glimpse of the new fourth-generation Uconnect system featuring Apple CarPlay and Android Auto."The Uconnect team is evolving Uconnect and making it even better," said Joni Christensen, Head of Uconnect Marketing, FCA US LLC.

Italy reportedly guarantees $7.1 billion loan to Fiat Chrysler

ROME — Italy has approved a decree offering state guarantees for a 6.3-billion euro ($7.1 billion) loan to Fiat Chrysler's (FCA)  Italian unit, a source said, paving the way for the largest crisis loan to a European carmaker. The source said Italy's audit court had signed off on the decree, in a final step of what had been a lengthy and contested process to get the loan approved. The court's approval follows an earlier endorsement by the economy ministry. "The audit court authorized the decree," said a source close to the matter, asking not to be named because of its sensitivity. FCA's Italian division has tapped Rome's COVID-19 emergency financing schemes to secure a state-backed, three-year facility to help the group's operations in the country, as well as Italy's car sector in which about 10,000 businesses operate, weather the crisis triggered by the coronavirus emergency. The loan will be disbursed by Italy's biggest retail bank Intesa Sanpaolo, which has already authorized it pending the approval of guarantees the government will provide on 80% of the sum through export credit agency SACE. The request for state support has sparked controversy because FCA is working to merge with French rival PSA and the holding for the Italian-American carmaker is registered in the Netherlands. FCA's global brands include Fiat, Jeep, Dodge and Maserati. It was not immediately clear what conditions, if any, Italy has set as part of the guarantees and whether they would affect FCA's planned 5.5 billion euro ($6.2 billion) extraordinary dividend, which is a key element in the merger with PSA. FCA, whose shares were down 0.5% by 0908 GMT, had no immediate comment.   Earnings/Financials Chrysler Fiat Peugeot Italy