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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.

Maxwell RHEV Prototype First Drive Review | More than meets the eye

The Maxwell RHEV looks just like any small business' panel van, sporting large vinyl graphics and unassuming steel wheels. You'd have no idea that the co-founders of the startup based out of Seattle had grafted a salvaged Voltec powertrain from a junkyard Chevy Volt into this Ram ProMaster. Somewhere, a battery pack lurks. Maxwell's co-founders, CEO Max Pfeiffer and engineer Trey Camp, open the cargo area to reveal a completely unaltered space. Both are ex-Tesla employees with a long fascination for the #vanlife movement – that their interests intersected in a hybrid cargo van isn't surprising once you start talking to them. This is their first vehicle, a salvaged ProMaster sidelined with a blown 3.6-liter Pentastar, and it's both their prototype and the only Maxwell in existence right now. That said, the company is building a low-roof version for a customer, which will be lighter, have less aero drag and therefore be more efficient. The company is just emerging from a stealth startup mode, and while their backstory is fascinating, I'm still wondering where the Volt's 18.4 kWh battery pack is. "There's nothing in the back ... we're able to get the battery underneath the floor, in the center," Pfeiffer says. Ducking my head under the side reveals, sure enough, a little underside blister that contains the battery, tucked up neatly. The other changes to the RHEV – short for Range-extended Hybrid Electric Vehicle – are minimal. He pops the hood. There are some rough edges, but the 1.5-liter, 101-horsepower engine and 48-kW motor fit comfortably on custom engine mounts and with re-routed exhaust, behind a fascia that improves aero and houses the charge port. Custom axles send power to unaltered Ram hubs and brakes. "This version, it's a little bit prototype-y," Pfeiffer says. "We've had more time to work with the CAD [computer-aided design, engineering drawings] we were able to get from GM and Chrysler, and we've done a better job packaging for production." GM already spent billions on the Voltec and its controlling software, and Maxwell can happily ride those coattails. Despite the help GM has lent Maxwell, there are no official ties. An emulator sends spoofed signals to the Ram instruments, which have a new custom-printed face. The Ram's body control module is left alone. For powertrain faults, Maxwell says the vehicle can theoretically be serviced by any Chevy dealer, and any issue with the rest of the vehicle can be handled by a Ram service shop.

Lexus tops JD Power Vehicle Dependability Study again, Buick bests Toyota

It shouldn't surprise anyone, but Lexus has once again taken the top spot in JD Power's Vehicle Dependability Study. That'd be the Japanese luxury brand's fourth straight year at the top of table. The big news, though, is the rise of Buick. General Motor's near-premium brand beat out Toyota to take second place, with 110 problems per 100 vehicles compared to Toyota's 111 problems. Lexus owners only reported 89 problems per 100 vehicles. Besides Buick's three-position jump, Scion enjoyed a major improvement, jumping 13 positions from 2014. Ram and Mitsubishi made big gains, as well, moving up 11 and 10 positions, respectively. In terms of individual segments, GM and Toyota both excelled, taking home seven segment awards each. The study wasn't good news for all involved, though. A number of popular automakers finished below the industry average of 147 problems per 100 vehicles, including Subaru, (157PP100), Volkswagen (165PP100), Ford/Hyundai (188PP100 each) and Mini (193PP100). The biggest losers (by a tremendous margin, we might add) were Land Rover and Fiat, recording 258 and 273 problems per 100 vehicles. The next closest brand was Jeep, with 197PP100. While the Vehicle Dependability Study uses the same measurement system as the Initial Quality Survey, the two metrics analyze very different things. The VDS looks at problems experienced by original owners of model year 2012 vehicles over the past 12 months, while the oft-quoted IQS focuses on problems in the first 90 days of new-vehicle ownership. Like the IQS, though, the VDS has a rather broad definition of what a problem is. Because of that, a low score from JD Power is no guarantee of extreme unreliability, so much as just poor design. In this most recent study, the two most reported problems focused on Bluetooth connectivity and the voice-command systems. The former leaves plenty of room for user error due to poor design (particularly true of the Bluetooth systems on the low-scoring Fords, Volkswagens and Subarus), while the second is something JD Power has already confirmed as being universally terrible. That makes means that while these studies are important, they shouldn't be taken as gospel when it comes to automotive reliability. News Source: JD PowerImage Credit: Copyright 2015 Jeremy Korzeniewski / AOL Buick Fiat Ford GM Hyundai Jeep Land Rover Lexus MINI Mitsubishi RAM Scion Subaru Toyota Volkswagen Auto Repair Ownership study