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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.

Fiat Chrysler starts production of ventilator components in Italy

MILAN — Fiat Chrysler has begun producing ventilator parts to help Italy's Siare Engineering boost its output of the medical equipment needed to treat patients during the coronavirus crisis, the carmaker said on Friday. Carmakers around the world are ramping up production of critical healthcare products and machines to respond to the enormous demand during the pandemic. Italy, the epicenter of the virus outbreak in Europe, had asked Siare to triple its normal monthly production as a part of government efforts to increase the number of intensive care beds. FCA said that with the support of luxury group Ferrari and holding company Exor, which controls both carmakers, it had produced the first electrovalves, a key part in ventilators, at its plant in Cento, in northern Italy. The Cento plant is usually used to produces high-performance car engines for the global market. It had been closed because of the coronavirus but has partially reopened for this project. "With the additional supply of electrovalves from Cento, Siare estimates that it will be able to reduce total production time for ventilators by as much as 30-50%", the statement said. In addition to the production of the electrovalves, a team of specialists from FCA is also working alongside Siare staff at their production facility near the city of Bologna. "The objective is to help increase Siare's total production, with a gradual scaling up of daily output beginning from the first week of April", FCA said.

Fiat opens doors at Abarth factory on Google Street View

Google Street View has emerged as a great tool for checking out locations along your driving route, and even scoping out places you don't have a chance to go yourself. And that includes some great automotive installations. The online tool has taken us inside museums, race tracks and factories around the world, but while it has not to date allowed us virtual access to a European automotive factory, Fiat is out to correct that wrong by letting the Street View team inside Officine Abarth.
The new Abarth Virtual Tour allows online visitors to see the complex in Turin where it makes its hot hatches, including the lifts where the mechanics go to work, the paint spray booth, and a variety of technical workshops, as well as a display of historic Abarth models, a 360-degree view inside and out of the extreme Abarth 695 Biposto and even inside a reproduction of founder Karl Abarth's office. Scope it out for a visit inside Italy's premiere hot hatch studio.