Stellantis Says Electric Vehicles Cost 40-50% More To Make But That Won’t Slow Its EV Push

Stellantis has no less than 19 battery-electric vehicles in its range and while it will continue to introduce more, the group’s chief executive, Carlos Tavares, acknowledges that building an EV still costs quite a bit more than a combustion vehicle.

While speaking with investors about the company’s second-half and full-year 2021 earnings, Tavares noted that the group enjoyed a strong 2021, thanks due to inflated costs, incentives and prices of its EVs. Moreover, Stellantis rewarded its unionized employees in the U.S. with a $14,670 bonus based on the strong year.

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During the same call, Tavares spoke about the cost of building an EV. Describing the cost of electrification as “the gorilla in the room,” Tavares said it costs Stellantis 40-50 per cent more to build an electric vehicle than a combustion-powered one. While Stellantis can sell its EVs for more than equivalent ICE models, it cannot pass all of these costs onto consumers, nor can the costs by absorbed by the automaker alone.

Tavares said one important move is for Stellantis to reduce its internal costs and bargain with its suppliers.

Something Stellantis has going in its favor is efficiency, Motor Trend reports. Tavares claims that the group is 30 per cent more efficient than most of its competition. This is evidenced by the fact that Stellantis had a strong financial year in 2021 despite only building 6 million of the 8 million vehicles it has the capacity to produce.

Stellantis will continue to release a plethora of new electric vehicles in the coming years. On the back of Tavares pushing for all of the group’s 14 brands to completely transition to EVs, Alfa Romeo recently introduced its first electrified model with the Tonale plug-in hybrid. The Italian marque will be all-electric after 2027 and in 2028, Chrysler plans to be all-electric too. Dodge is also readying its first electric muscle car for 2024 while electric versions of the Maserati GranTurismo and MC20 are being developed and new EVs from Citroen, Fiat, Opel, and Peugeot are also in the works.