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How Stellantis will tackle its electric future

Breana Noble, The Detroit News on

Published in Automotive News

The newest member of the global auto club, Stellantis NV, is racing to catch the industry's zero-emission transition and avoid becoming a transatlantic dinosaur.

More than two months after the merger between Fiat Chrysler Automobiles and French rival Groupe PSA, a new strategy still is being developed. What's clear now is that PSA brings a vertically integrated supply-chain strategy competitive with other automakers. And FCA delivers its partnership with Google parent Alphabet Inc.'s self-driving technology business, Waymo LLC, widely thought a leader in the autonomous space.

"To a certain extent, PSA was coming with a lot of good things, good assets in terms of CO2 emission reduction, and FCA was coming with great things in terms of autonomous vehicles," Stellantis CEO Carlos Tavares said during an earnings call earlier this month. "And now all of this is part of the assets that the family can enjoy."

The evolving strategy implicitly borrows from the first automotive century's golden age, when automakers from France and Germany to Japan and the United States controlled key parts of assembly and component production in what the industry called "vertical integration." To navigate the transition to the EV age — and, later, self-driving vehicles — legacy automakers like Stellantis and its rivals are adapting the concept.

Competitors like General Motors Co. are aiming to sell only EVs by 2035, while other automakers like Ford Motor Co.'s European operations, Sweden's Volvo Cars Ltd., Britain's Jaguars Cars Ltd. and others have set timelines for an all-electric lineup in the near future.

Stellantis has yet to give its internal combustion engines an expiration date across its 14 brands. But Tavares says the company is going "full-throttle" on full EVs as more governments place bans on gas- and diesel-powered vehicles, including hybrids. Stellantis will have 39 electrified models for sale by the end of the year.


'Key component'

The new automaker is the second-largest seller of EVs this year in Europe behind Volkswagen AG with 17.7% market share, according to market research firm Guidehouse Insights.

PSA brings two EV-dedicated platforms — eVMP and eCMP — to be used worldwide across Stellantis platforms, likely extending to small Fiat cars and smaller-sized Jeeps. It also has three major joint ventures to produce electric motors, transmissions for mild- and plug-in hybrids and battery cells. That capability, Tavares says, gives the company control over the cost, quality and performance of major components' engineering and manufacturing.

"Few other OEMs have all of this in place — in 180-degree contrast to some investors' views," Morgan Stanley analyst Harald Hendrikse wrote in a report earlier this month.


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