Stellantis: Electric cars won't cut prices or crash the market

Stellantis, one of Europe's largest automakers, haswarned that unless electric vehicles become cheaper, the auto industry will become volatile after the European Union reached a landmark deal to phase out internal combustion engine vehicles,media reported.

On June 30,Stellantischief manufacturing officer Arnaud Deboeuf said the company aims to reduce the cost of making electric vehicles by 40 percent by 2030.Stellantisplans to manufacture some of its components itself and force suppliers to lower prices.Deboeuf, of Stellantis in Tremery, France, believes that "the market will collapse" if EV prices don't fall.

Stellantis plans to launch more than 75 pure electric models within 10 years and convert at least some French car factories to electric vehicles.While the company has invested heavily in launching pure electric vehicles, Stellantis promises strong returns in software and services, as well as additional revenue from some premium vehicles.

Electric vehicle prices have been rising at a dizzying pace recently.Tesla raised the price of each vehicle by $6,000 this month, and Rivian Automotive Inc. and Ford Motor Co. also raised vehicle prices earlier this year.Rising raw material costs have made some battery-powered models unprofitable, Ford Chief Financial Officer John Lawler told an investor at a meeting earlier this month.

Most automakers may have to switch to electric vehicles over the next 10+ years as EU lawmakers back the auto industry to move away from fossil fuels.

Stellantis Chief Executive Carlos Tavares said on June 30 that while the company will comply with the decision, policymakers appear "not concerned" with whether automakers have enough raw materials to support the shift.

According to Tang Weishi, the demand for electric vehicle batteries will increase sharply between 2024 and 2027.Stellantis is developing five large battery factories in North America and Europe to produce 400 GWh of batteries by 2030.He also said the company had not ruled out buying mines to secure the supply of raw materials.