Stellantis is looking to India for a low-cost manufacturing market. | So Good News
Fiat parent Stellantis has concluded that it cannot produce affordable EVs in Europe. However, it is looking for a low-cost manufacturing market like India. With its low-cost supplier base, India will be able to meet the company’s quality and cost targets by the end of 2023. The CEO of the group, whose brands include Peugeot and Chrysler, said the door was open to exporting EVs to others. Markets
“Until now, we have not been able to produce affordable EVs in Europe. So the big opportunity for India is to be able to sell EV compact cars at affordable prices that protect profitability,” Tavares told reporters at a media roundtable in India late Wednesday. Stellantis is investing heavily in EVs and plans to produce dozens of electric models over the next decade, but Tavares warned last month that affordable battery electric cars are five to six years away.
In his first visit to India after taking over as CEO, Stellantis said the company is still working on plans to export EVs from the country and has not made any decisions. Tavares’ possible bets on India come after US automakers Ford and General Motors, which have broken the dominance of Japan’s Suzuki Motor Corp and South Korea’s Hyundai Motor in the world’s fourth-largest car market.
It also comes as Chinese EV makers are making inroads into Europe, aiming to poach most foreign rivals in China, the world’s largest EV market, and win over buyers of cheaper cars. Stellantis is the latest to refocus its strategy in China, where it plans to play a multi-sector presence through its Jeep and Maserati brands, after it said its Jeep joint venture in the country would go bankrupt.
“Tensions between China and the West are increasing. That will have economic consequences. India is obviously the best place to take advantage of this opportunity,” Tavares said. While Stellantis makes up a fraction of the carmaker’s global sales in India, where it sells its Jeep and Citroen brands, Tavares said the company wants to gradually improve profitability without chasing volume. It plans to launch its first EV in the country early next year, an electric model of its Citroen C3 compact car. Stellantis already makes its own electric motors and battery packs, and also has plans to make battery cells. In India too, Tavares wants to source EV components, including batteries, locally so it can be cost and price competitive.