Carlos Tavares, CEO of Stellantis, warned that the recession could slow the growth of electric vehicle adoption, especially if governments cut spending and incentives.
Speaking at the virtual roundtable from Germany, Tavares said central banks need to be careful in their decisions and that rising interest rates on debt service due to high interest rates could lead to cuts in government spending when consumers need it. As much support as possible to access the EV.
“If you undermine the ability of the middle class to buy electric cars because you support them less, you don’t have that much money because you have to cover the budget deficit,” Tavares said, “because you can’t continue. to increase the debt, because debt service is very expensive, and you will widen the gap due to rising interest rates.
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Tavares has previously warned that the automotive industry will face a shortage of high-voltage batteries in 2024 or 2025, and expects more production to go online. The automaker will begin production at the North American battery plant in Kokomo, Indiana, in 2025, and as it and other major battery sites are connected to the network, there could be a shortage of raw materials by 2027 or 2028.
With this in mind, Tavares said it was important for emission requirements to be stable and that some companies may not be able to meet due to supply chain constraints. Detroit news reports.
“The only thing that really helps to deliver is stability,” Tavares said. “Stop playing by the rules. Leave the rules the same and let people do the right thing by paying more attention. ”
Stellantis will invest $ 35.5 billion in electrification and software by 2025, and expects half of its sales in the U.S. by 2030 to be for electric cars. The carmaker is ready to withstand the small car market when moving to EV, Tavares added.
“If demand goes south and there is no access factor, then we should be able to live with a lower customer base,” he said. To do this, Stellantis tries to keep its break-even point at 50% of sales. “With low sales, at least for a certain period of time, it means protecting the company and ensuring the stability of the company, we need to maintain our break-even point, that’s what we’re doing.”
