Stellantis, Tavares: “The price war initiated by Tesla will endanger the sector”

Francesco Armenio
According to Carlos Tavares, CEO of Stellantis, the ‘price war’ started by Tesla will jeopardize the electric car market.
Carlos Tavares

Stellantis unveiled their new STLA Large platform. It will serve as the foundation for the upcoming sedans, crossovers, and electric SUVs in the D and E segments. Over the next few years, eight models from various Stellantis brands will be produced, between 2024 and 2026, all based on this platform.

According to Carlos Tavares, Stellantis’ CEO, the ‘price war’ initiated by Tesla in the electric car market could jeopardize the industry

During the event, Carlos Tavares, CEO of Stellantis, highlighted the group’s positive progress in their electrification project. He explicitly stated that electrified vehicles, both BEV (Battery Electric Vehicle) and PHEV (Plug-in Hybrid Electric Vehicle), are generating profits in the United States and Europe. This reflects the company’s philosophy of not pursuing unprofitable activities. Tavares also emphasized the need for incentives to offset the higher cost of BEVs, while reaffirming Stellantis’ commitment to covering 40% of the extra cost in the coming years, despite it requiring time and energy.

Tavares then reignited concerns about the ‘price war’ in the electric car industry, a long-standing worry in the sector. According to the group’s CEO, Tesla‘s strategy of cutting prices might lead to an unsustainable market. In response, Stellantis plans to cut prices only after effectively reducing production costs. Tavares added that if prices fall faster than production costs, it could create financial difficulties for some companies, exposing them to the risk of acquisition by stronger groups.

Stellantis

Despite these challenges, Stellantis’ electrification plan is proceeding as expected, though the future could be influenced by the upcoming elections in the USA and Europe. Tavares stressed the importance of closely observing these political events, as they could dictate a shift in automotive policy direction.

Finally, regarding the ‘Red Sea Crisis’, Tavares noted that Stellantis has not suffered major impacts, unlike Tesla, which announced a two-week production halt at its German Gigafactory due to supply chain issues. Tavares concluded by stating that, although travel times might extend due to the rerouting of maritime routes, he currently does not foresee significant impacts for Stellantis.