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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.

Mopar's 80 years told through vintage ads

It's more than just car parts. Mopar started in 1937 an antifreeze brand, and 80 years later Fiat Chrysler's now-iconic aftermarket division is known for everything from muscle cars to smart phone apps. This is reflected in its advertisements over the years, which show off the brand's capabilities at different moments. Rediscovered from deep in Mopar's archives as it kicks off a year-long celebration of its history, the ads are snapshots of the former Chrysler Corp. and the mood of America at those times. A colorful, free-spirited 1972 ad hawks T-shirts. A plainer 1964 spot shows off Mopar's expansive portfolio with the tagline, "sorry, we ran out of space!" There were too many parts to show them all. Another 1960s ad explains Mopar's new wire and cable products in what was likely a magazine spread or multi-column newspaper entry. Going back farther, an ad from the 1940s touts radios through wind-in-your-hair exuberance, while a later placement shows a Ward Cleaver-type waxing his hardtop. Slightly more recently in 1989, Mopar used its muscle-car heritage to encourage restoration and customization just as nostalgia for that era was growing. "The Mopar brand holds an unparalleled place in the automotive world, possessing name recognition, scope of service, and passionate enthusiasts unmatched by any other service and parts organization in the industry," Pietro Gorlier, Mopar's global chief, said in a statement. While those advertisements highlight its earlier days, Mopar is using its 80th year to look forward, noting its modern service offerings, competition in motorsports, and special edition models, like a custom Ram Rebel. These ventures have advanced the Mopar's scope and elevated its awareness with consumers, who often don't know what brand of aftermarket products their car uses. Yes, Mopar still wants to sell as many car parts as possible, but as these ads show, it's always been more than that. Related Video: Featured Gallery Vintage Mopar Ads Marketing/Advertising Chrysler Fiat Automotive History

Marchionne says no offers are on the table for Fiat Chrysler

MONZA, Italy (Reuters) - Fiat Chrysler (FCA) has not received any offer for the company nor is the world's seventh-largest carmaker working on any "big deal", Chief Executive Sergio Marchionne said on Saturday. Speaking on the sidelines of the Italian Formula One Grand Prix, Marchionne said the focus remained on executing the company's business plan to 2018. Asked whether FCA had been approached by someone or whether there was an offer on the table, he simply said: "No." The company's share price jumped to record highs last month after reports of interest for the group or some of its brands from China. China's Great Wall Motor Co Ltd openly said it was interested in FCA, but had not held talks or signed a deal with executives at the Italian-American automaker. The stock move was also helped by expectations that the company might separate from some of its units. Marchionne reiterated on Saturday that FCA was working on a plan to "purify" its portfolio and that units, such as the components businesses, would be separated from the group. He hopes to complete that process by the end of 2018. "There are activities within the group that do not belong to a car manufacturer, for example the components businesses. The group needs to be cleared of those things," he told journalists. Asked whether an announcement could come this year, Marchionne said it was up to the board to decide and that it would next meet at the end of September. He said the time was not right for a spin-off of luxury brand Maserati and premium Alfa Romeo and the two brands needed to become self-sustainable entities first and "have the muscle to stand on their feet, make sufficient cash". "The way we see it now, it's almost impossible, if not impossible, to see a spin-off of Alfa Romeo/Maserati, these are two entities that are immature and in a development phase," he said. "It's the wrong moment, we are not in a condition to do it." He said the concept of separating the two brands from FCA's mass market business made sense and did not rule out this happening in future, but not under his tenure, which lasts until April 2019. "If there is an opportunity in future, it would certainly happen after I'm gone. It won't happen while Marchionne is around," he said.