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Stellantis won't race to split electric vehicles from fossil fuel cars

MILAN - Stellantis is not considering splitting its electric vehicle (EV) business from its legacy combustion engine operation, its finance chief said on Thursday, as the carmaker presented above-expectation revenue data for the first quarter. Chief Financial Officer Richard Palmer told analysts he did not see huge benefits in the kind of separations pursued by rivals such as France's Renault and U.S. Ford. "We need to manage the company and the assets we have through this transition," he said. "There are benefits to having the cash flow being generated by the internal combustion business for the investments we need to make." Palmer said the group, formed by a merger last year of Fiat Chrysler and Peugeot maker PSA, was not averse to considering adjusting its structure "but we aren't anticipating any big changes." Palmer's comments came after the world's fourth largest carmaker said its net revenue rose 12% to 41.5 billion euros ($44.1 billion) in the January-March period, as strong pricing and the type of vehicles sold helped offset the impact of the semiconductor shortage on volumes. That topped analyst expectations of 36.9 billion euros, according to a Reuters poll. Milan-listed shares were up 0.5% by 1415 GMT, in line with Italy's blue-chip index. The impact of the chip crunch was evident in the decline in shipment figures which fell 12% in the quarter to 1.374 million vehicles. It was a similar story for Germany's BMW which posted higher revenues on Thursday and a decline in car sales. Riding the Recovery Stellantis, whose brands also include Citroen, Jeep and Maserati, confirmed its 2022 forecasts for a double-digit adjusted operating income margin, after 11.8% last year, and a positive cash-flow despite supply and inflationary headwinds. Morgan Stanley analysts said after the results that Stellantis had better management than many peers and benefited from its significant exposure to a stronger U.S. economy and a European recovery from the COVID-19 pandemic. They also said it was less affected by a slowing Chinese economy. Palmer said it was important for the group to maintain double-digit margins and keep delivering positive cash flows. "A 12% increase in revenue with a 12% decrease in volumes indicates a very strong performance on price and mix, which augurs well for our margin performance," he said. He said semiconductor supply problems were expected to ease this year with continued improvements in 2023.

2021 Ram 1500 TRX | How we'd build our Hellcat-powered pickup

That didn’t take long. The 2021 Ram 1500 TRX was only revealed yesterday, but the configurator is already up and running. HereÂ’s the link. We surveyed the room to see how all of us would spec out their supercharged pickup. For a truck that starts above $70,000, there are a surprising number of option boxes available to check. If money doesnÂ’t matter, you can spec out a TRX thatÂ’s over $90,000. Even reasonably-equipped trucks will crest $80,000 quickly. There isn't unanimous agreement about whether we like the truck or not either. Spoiler alert: Green Editor John Snyder isnÂ’t a fan. Fuel economy in Challenger and Charger Hellcats can easily dip into the single digits when driven aggressively, and we can guarantee that the truck will only be worse. Others adore its silliness and FCAÂ’s current strategy of shoving its supercharged V8 into any vehicle that will accommodate one. We could go for a Pacificat next. The Previa canÂ’t have all the supercharged minivan fun. Read on to see our builds, and let us know how youÂ’d spec a TRX out in the comments below. Road Test Editor Zac Palmer: ThereÂ’s no making this truck cheap. The TRX is extremely expensive, and anybody buying one will just have to accept it. ThatÂ’s why IÂ’ve decided to go nearly all out with my build. After all, if youÂ’re paying luxury car money for a vehicle, you might as well enjoy a luxury experience. My TRX costs $88,665. It has $16,975 worth of options on it, which isnÂ’t entirely out of the ordinary for trucks these days. On the outside, I chose the bright Hydro-Blue Pearl paint. For only $100, I couldnÂ’t say no to a color. The TRX would look menacing in black or gray, but I think a bright color is much more fitting for an off-road play truck. I also went with the all-black non-beadlock wheels, because I prefer the look and probably donÂ’t need the capability. Rock rails and the bed-mounted tire carrier were also on my list. ItÂ’s not like I want to carry a tire around in my bed, but it sure does look the part. Again, this is a silly truck. Optioning it with silly add-ons is what it deserves. The interior options are boring, but I was able to spruce it up a smidge with TRX red interior accents. My biggest purchase was the TR2 trim package, though. You get Â… well, pretty much everything for $7,920.

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.