Following in the footsteps of General Motors and Ford, Stellantis, the world’s fourth-biggest automaker, is finally joining the race to go electric. With 14 brands under its belt, including Chrysler, Jeep, Ram, Dodge and Maserati, the automaker plans to invest 30 billion euros through 2025 to electrify its entire lineup.
Stellantis CEO Carlos Tavares announced during the company’s “EV Day” that the company will aim to electrify 98 per cent of the models across its 14 brands in Europe and North America. The automaker forecasts that by 2030, low-emission vehicle (LEV) sales, which includes battery electric vehicles (BEVs) and plug-in hybrid electric vehicles (PHEVs), will account for more than 70 per cent of its European sales and more than 40 per cent of its North American sales. That’s a big jump compared to where Stellantis is currently – the company estimates BEVs and PHEVs will only account for 14 per cent of its European sales and four per cent of its North American sales by the end of 2021. The figure is also significant given current projections of the global electric vehicle market. The International Energy Agency expects BEVs and PHEVS to make up 35.8 per cent of the European market, and just 15.7 per cent of the U.S. Market by 2030.
Under the plan, Stellantis, which was formed earlier this year from the merger of Fiat Chrysler Automobiles and France’s PSA Group, will develop four battery-electric vehicle platforms – three unibody platforms and one body-on-frame platform. The platforms include a small platform for compact city cars, a medium platform for premium vehicles; a large platform for all-wheel-drive and midsize-to-full-size vehicles including American muscle cars, as well as a frame platform for commercial vehicles, pickups, and SUVs. The platforms will have an electric range between 500 to 800 km and fast-charging capabilities of 32 km per minute. They’ll be designed for software and hardware upgrades and a high level of flexibility and component sharing to deliver economies of scale so platforms can support production of up to 2 million units per year. The plan also includes developing three electric drive modules that combine the motor, gearbox and inverter, which can be configured for front-drive, rear-drive, all-wheel drive and 4xe, a drive mode unique to Jeep vehicles. The company also made major infrastructure commitments, with plans to build five battery plants in Europe and North America to meet the growing demand for the LEVs. Three of the factories are already slated for Europe.
One of the more surprising new models announced include Dodge’s first battery electric muscle car – a sharp contrast to the supercharged 6.2L Hemi V8 engine powering some of the world’s fastest cars like the Dodge Challenger SRT Hellcat. Other models making the electric switch include the Jeep Grand Cherokee and the RAM 1500 BEV, which will start production in 2024. Delivery of the first hydrogen fuel-cell vans will begin later this year. In total, Stellantis plans to have 55 LEV vehicles across European and North American passenger vehicle portfolios by 2025 – 40 will be BEV version and 15 PHEV versions.
One of the challenges of this transition is to “reduce the cost of this new technology supporting the lower emission powertrains,” says Stellantis CFO Richard Palmer. By 2024, Stellantis plans to reduce the battery pack costs for nickel-based batteries by more than 40 per cent compared to 2020 levels. And then further reduce the cost by 20 per cent from 2024 to 2030. One of the key contributors to reduce costs and come to market faster is working with joint partners and suppliers. Stellantis currently has or is completing six key technology joint ventures, ranging from e-powertrain and e-transmission operations to battery cell chemistry and production to digital cockpit and personalized connected services – all in an effort to pool resources and become more competitive.
“We expect our overall R&D and spending over the next five years to continue to be about 30 per cent more efficient than the industry average based on percentages spent versus revenues,” adds Palmer.
But Tavares acknowledges there are risks ahead. “It’s fair to say there is an execution risk. But as we know in our industry it is a related game so what you have to access the execution risk of Stellantis with what you know about our top executive team compared to other companies. It is fair to say this is an unprecedented transition for the industry in a very compact time window with a significant amount of change…There is an execution risk, which I don’t believe is higher for Stellantis than for any other car company.” says Tavares.