Stellantis CEO worries about cost, demand for EVs

If a worker at a Stellantis engine plant gets a job offer from one of the automaker’s new battery plants,  “run” to take it, the automaker’s CEO advised in an interview at the New York auto show 

The transition from traditional petroleum-burning to electric vehicles is very much on Tavares’ mind as he plots a path for Stellantis’ 14 brands and 100 models.

The auto industry is changing, and Tavares doesn’t claim to know what it’ll look like next.

“Some jobs will be disrupted; some will be created.”

He’s not overly concerned about this year’s contract talks at Stellantis’ U.S. operations, which build and sell Ram, Jeep, Dodge, Chrysler, Fiat and Alfa Romeo vehicles.

“All over the world, we have very interesting and open dialogue with unions.” he said. “All the risks today are external to the company: Inflation, semiconductor (shortages), harsh regulations,” accelerating the move to EVs.

“I’m not concerned about a strike,” Tavares said. “I’m not the decision maker,” suggesting that if there’s a strike, the responsibility will lie with the union.

Stellantis’ U.S. union workers just banked $14,760 profit sharing checks.

“We’ve got a great working relationship,” Stellantis North American COO Mark Stewart said. “Over the years, we’ve come to solutions that work” for the company and its employees.

Stellantis is “fine with” its new battery plants having union representation for employees, but “it’s not our decision,” because they’re joint ventures with foreign battery makers, he said.

The company is “looking for other cases” for its recently idled plant in Belvidere, Illinois, Stewart said.

Higher costs, fewer workers needed

EVs cost 40% more to make than internal combustion cars, Tavares said. They also require a smaller workforce, because they lack complicated, labor-intensive parts like internal combustion engines and multi-gear transmissions.

“We must be extremely strategic,” about the transition, said Tavares, saying he has spoken with “chiefs of state” about the issue, and that conversations with the Biden administration were “quite productive.”

“If we don’t significantly reduce costs, the middle class can’t afford vehicles and everybody loses,” he said.

Tavares looks at the issue in literally global terms, both because it is, and because that lets him shift responsibility to governments around the world that are pushing the change.

Tavares is far from a climate-change denier: “The clock is ticking for the planet.”

At the same time, he’s not volunteering to foot the bill solo. He wants big increases in renewable energy production and charging infrastructure.

“The people have decided on this change. They cannot assume it means no change for them. It is about all of us.

“In modern democracies, governments have decided on electric vehicles,” he said. “It’s not a problem (for) corporations solely.”