Stellantis CEO Signals Strategic Approach to Steer Clear of Drastic Price Reductions

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Stellantis Director Carlos Tavares emphasized the importance of avoiding wars that could be beneficial and potentially leave manufacturers vulnerable to regulation. Tavares introduced the company’s new platform for large battery electric vehicles (BEVs) and highlighted Stellantis’ relative resilience as one of the most profitable companies in the industry.

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Concerned about the possibility of a decrease in costs affecting competitors, Tavares warned against making bad decisions without considering investment costs. He emphasized the need to avoid a “race to the bottom” and gave a cautionary example: A company’s profits fell after it implemented cost-cutting measures.

It is worth noting that Tesla has recently reduced the price of its products. Following China, Europe has also implemented similar measures to cope with the uncertainty in demand for electric vehicles. Despite the economic crisis, Tavares reiterated Stellantis’ determination to keep the same price to maintain profits.

As for the impact on Red Sea shipping, Tavares downplayed the potential impact, saying it could lead to longer travel times for supplies. He acknowledged that price negotiations were possible but confirmed that the deal did not yet have a major impact on Stellantis. Tavares compared this to some rivals such as Tesla and Volvo Cars, which suspended production in Europe due to the Red Sea crisis.

Regarding the acquisition, Tavares admits that the Red Sea influence will not quickly change Stellantis’ approach. He emphasized the importance of Far Eastern products in making electric cars affordable for Western customers and said that all measures leading to better prices are being pursued as the company’s goals.