Tavares Says Electric Vehicles Cost 40% More To Manufacture

[redriderbob]

Tavares Says Electric Vehicles Cost 40% More To Manufacture​

Automakers Can't Pass The Costs Onto Consumers...​

The CEO of Stellantis, Carlos Tavares, has expressed some skepticism regarding the electrification hype currently being promoted by politicians around the world. While not dismissing the importance of electric vehicles (EVs) outright, Tavares has raised concerns about the practicalities of mass-producing them and the economic implications of doing so.

Tavares Says Electric Vehicles Cost 40% More To Manufacture

The CEO of Stellantis, Carlos Tavares, has expressed some skepticism regarding the electrification hype currently being promoted by politicians around the world. While not dismissing the importance of electric vehicles (EVs) outright, Tavares has raised concerns about the practicalities of...

moparinsiders.com

 

[TripleT]

Some of that will improve with scale, especially in battery manufacturing, the logistics alone right now are insane.

 

[Deckard Cain]

Considering that Tesla has insane profit margins and their models are price competitive within the respective segment with ICE vehicles they have shown that it's possible to make EVs profitably and competitively with ICEs.
Tavares is just crying and moaning because Stellantis (mainly the euro side) was caught with their pants down and started this path much later than they should've. Now they're caught between Tesla's price cuts on one side and on MG's and BYD's hyper-competitive EVs on the other. Thus, Stellantis cannot now overcharge for subpar EVs with small battery packs like the e208, Avenger or the upcoming e308 and Astra-e.

 

[TripleT]

Telsa makes everything at a single sight. Most of the current OEM are shipping components long distances in expendable dunnage.

This will change soon, Kokomo is at full speed, GM and Fords battery plants are all under construction. They always think of logistics last, you cannot do this with these Class 3 hazardous goods. It massively is adding to cost of manufacturing what should be simpler process.

 

[cygnus]

Considering that Tesla has insane profit margins and their models are price competitive within the respective segment with ICE vehicles they have shown that it's possible to make EVs profitably and competitively with ICEs.
Tavares is just crying and moaning because Stellantis (mainly the euro side) was caught with their pants down and started this path much later than they should've. Now they're caught between Tesla's price cuts on one side and on MG's and BYD's hyper-competitive EVs on the other. Thus, Stellantis cannot now overcharge for subpar EVs with small battery packs like the e208, Avenger or the upcoming e308 and Astra-e.

Agreed. There are no STLA 'passion Product' EVs in the same manner as the existing STLA ICE vehicles. STLA cannot get away with their same shenanigans with an EV Jeep portfolio that they did with the ICE Jeep portfolio. I'm only talking about the US, I could care less what STLA Europe does, but the underlying assumption I describe loosely holds true. There is no existing Customer loyalty (a group they've abused with higher prices) attached to Jeep EVs. Those Customers will simply go to the OEM that will build ICE vehicles. I'm not talking about going to an overpriced Bronco either. You're going to have people going to the 2024 Tacoma and 2025 4Runner, body on frame vehicles with mild-hybrids at competitive prices. The GM mid-size pickups are stupid expensive, almost the same as an overpriced Wrangler.

It's all happening on the JLWranglerForums, if these stupid executives would read it. People are migrating away from Jeep, it's already started.

Everything I predicted about the downfall of US CDJR will eventually happen if this management group remains in place. 2022 was the top of the market, in terms of vehicles sold/profits - vehicle volumes were (and still are) less than pre-Covid, but results/profits were goosed due to limited vehicle supply because of Covid/supply chain issues. That's not the case anymore - vehicle deliveries are falling (due to higher interest rates), dealer lots are packed with unsold vehicles, and ASPs are (finally) going to start coming down if they have any hope of moving metal. Its all downhill from here.

 

[AlexB]

Agreed. There are no STLA 'passion Product' EVs in the same manner as the existing STLA ICE vehicles. STLA cannot get away with their same shenanigans with an EV Jeep portfolio that they did with the ICE Jeep portfolio. I'm only talking about the US, I could care less what STLA Europe does, but the underlying assumption I describe loosely holds true. There is no existing Customer loyalty (a group they've abused with higher prices) attached to Jeep EVs. Those Customers will simply go to the OEM that will build ICE vehicles. I'm not talking about going to an overpriced Bronco either. You're going to have people going to the 2024 Tacoma and 2025 4Runner, body on frame vehicles with mild-hybrids at competitive prices. The GM mid-size pickups are stupid expensive, almost the same as an overpriced Wrangler.

It's all happening on the JLWranglerForums, if these stupid executives would read it. People are migrating away from Jeep, it's already started.

Everything I predicted about the downfall of US CDJR will eventually happen if this management group remains in place. 2022 was the top of the market, in terms of vehicles sold/profits - vehicle volumes were (and still are) less than pre-Covid, but results/profits were goosed due to limited vehicle supply because of Covid/supply chain issues. That's not the case anymore - vehicle deliveries are falling (due to higher interest rates), dealer lots are packed with unsold vehicles, and ASPs are (finally) going to start coming down if they have any hope of moving metal. Its all downhill from here.

“Wrangler overpriced” is complete nonsense (in 2018 it was nonsense, and 2023 still nonsense) .
1:Lower priced JK Models had lower take rates, while models with higher trim levels with options sold better.
2: The company believe that historically the Wrangler was underpriced , decisions to take actions to correct the underpricing was made back in 2015.
3:2015 decision was made Wrangler needed more Options/Trims/Packages

4Runner is a very different vehicle than Wrangler and if the 4Runner is a Wrangler competitor then so is the Tahoe.

 

[UN4GTBL]

Agreed. There are no STLA 'passion Product' EVs in the same manner as the existing STLA ICE vehicles. STLA cannot get away with their same shenanigans with an EV Jeep portfolio that they did with the ICE Jeep portfolio. I'm only talking about the US, I could care less what STLA Europe does, but the underlying assumption I describe loosely holds true. There is no existing Customer loyalty (a group they've abused with higher prices) attached to Jeep EVs. Those Customers will simply go to the OEM that will build ICE vehicles. I'm not talking about going to an overpriced Bronco either. You're going to have people going to the 2024 Tacoma and 2025 4Runner, body on frame vehicles with mild-hybrids at competitive prices. The GM mid-size pickups are stupid expensive, almost the same as an overpriced Wrangler.

It's all happening on the JLWranglerForums, if these stupid executives would read it. People are migrating away from Jeep, it's already started.

Everything I predicted about the downfall of US CDJR will eventually happen if this management group remains in place. 2022 was the top of the market, in terms of vehicles sold/profits - vehicle volumes were (and still are) less than pre-Covid, but results/profits were goosed due to limited vehicle supply because of Covid/supply chain issues. That's not the case anymore - vehicle deliveries are falling (due to higher interest rates), dealer lots are packed with unsold vehicles, and ASPs are (finally) going to start coming down if they have any hope of moving metal. Its all downhill from here.

I'm seeing 0% interest ads again here for Jeep...

Having said that, the 2023 MSRP jump for the WL TH is wild

 

[cygnus]

“Wrangler overpriced” is complete nonsense (in 2018 it was nonsense, and 2023 still nonsense) .
1:Lower priced JK Models had lower take rates, while models with higher trim levels with options sold better.
2: The company believe that historically the Wrangler was underpriced , decisions to take actions to correct the underpricing was made back in 2015.
3:2015 decision was made Wrangler needed more Options/Trims/Packages

4Runner is a very different vehicle than Wrangler and if the 4Runner is a Wrangler competitor then so is the Tahoe.

Wrangler and Gladiator sales are 20% off their peak, and continue to fall. Same is true for Grand Cherokee and Ram - volume peaked, Jeep has more inventory on lots than any other brand. Wagoner sales have been underwhelming - it really ought to hit 75K this year, at minimum, to pay for its investment.

If you don’t think the bumps in price in the last two or three years are different than Marchionne era bumps in price, you’re delusional. Yes, material costs are up, but no where near the 20-25% sticker increases they’ve put on Wrangler and Gladiator Rubicon and Sahara trims.
Remember when leadership tried to sell people on platform synergies for STLA small/medium/large platforms? There is hardly any overlap between the US and EU product portfolio, other than the Compass and Hornet.

They’ve completely flopped in China. Who was responsible for China? Have they been fired? If not, why not?

The PSA merger was a farce. This is Daimler 2.0. If you don’t see it yet, you won’t have to wait long - it’s already in motion.

Get out of here comparing a Tacoma or 4Runner with a Tahoe, that is laughable.

Stick to assessing Europe.

 

[AlexB]

Wrangler and Gladiator sales are 20% off their peak, and continue to fall. Same is true for Grand Cherokee and Ram - volume peaked, Jeep has more inventory on lots than any other brand. Wagoner sales have been underwhelming - it really ought to hit 75K this year, at minimum, to pay for its investment.

If you don’t think the bumps in price in the last two or three years are different than Marchionne era bumps in price, you’re delusional. Yes, material costs are up, but no where near the 20-25% sticker increases they’ve put on Wrangler and Gladiator Rubicon and Sahara trims.
Remember when leadership tried to sell people on platform synergies for STLA small/medium/large platforms? There is hardly any overlap between the US and EU product portfolio, other than the Compass and Hornet.

They’ve completely flopped in China. Who was responsible for China? Have they been fired? If not, why not?

The PSA merger was a farce. This is Daimler 2.0. If you don’t see it yet, you won’t have to wait long - it’s already in motion.

Get out of here comparing a Tacoma or 4Runner with a Tahoe, that is laughable.

Stick to assessing Europe.

Wrangler JL and Gladiator Volume are higher than JK at significantly higher pricing than JK with less third-party production (undid supply chain decisions made by Daimler/Cerberus) is a big time financial winner for FCA/Stellantis.

No clownish whining comparing 4Runner is going to change that. We don’t need every thread being loaded by you making threats to buy Ford one day and Toyota the next
Stellantis overall will surpass cost savings projection of the merger this year.
BTW: The Stellantis answer against Tahoe and the next generation Wrangler may (if certain data is correct) share a lot under skin.

 

[cygnus]

"Stellantis overall will surpass cost savings projection of the merger this year."

BS - '24 Wrangler order book just opened and pricing just went 8% higher, again. Mid-30K for Hornet G/T? Pass.

2022 Wrangler + Gladiator sales of 250K-ish, combined, barely beat 2018 Wrangler sales of 240K units. There is no way Gladiator and Wrangler (combined) will hit 240K US sales this year - hence I am once again correct in that things have peaked.

STLA has never had as much headcount as they do now, and generates about as much revenue per head as they did in the early post-bankruptcy days. Doesn't take a genius to figure out what comes next.

 

[AlexB]

“2022 Wrangler + Gladiator sales of 250K-ish, combined, barely beat 2018 Wrangler sales of 240K units”
Thank you for passively aggressive confirming the facts that JL+ Gladiator are significantly money for Stellantis than JK
2017 and 2018 figures includes BOTH JK and JL Wrangler.

PS: Non of the FCA merger plans take about passing savings to buyers, especially when in North America buyers paying too little.

 

[cygnus]

There's nothing novel about combining 2018 JK and JL sales. They were producing JK on the line that would later go on to be renovated and produce the Gladiator.

Yes they went higher margin and did well with intro year pent up demand in 2018 and 2019 with both Wrangler and Gladiator. And higher margin again due to Covid supply chain issues. They will never be above the 250K units, combined, for the remainder of this decade. Everything has peaked.

Sometime in the next quarter, one of the Toledo facilities will have extended downtime due to too much inventory. That is not progress. That is regression.

 

[AlexB]

There's nothing novel about combining 2018 JK and JL sales. They were producing JK on the line that would later go on to be renovated and produce the Gladiator.

Yes they went higher margin and did well with intro year pent up demand in 2018 and 2019 with both Wrangler and Gladiator. And higher margin again due to Covid supply chain issues. They will never be above the 250K units, combined, for the remainder of this decade. Everything has peaked.

Sometime in the next quarter, one of the Toledo facilities will have extended downtime due to too much inventory. That is not progress. That is regression.

Fact you that you claim nothing novel about the new model (Gladiator + JL) outselling a mix of JL+ Old lower priced JK Is good episode of SNL.

Especially when you ignore the factors that JL+ Gladiator is more profitable more revenue per unit than JK.
I will repeat most of them:

“Wrangler overpriced” is complete nonsense (in 2018 it was nonsense, and 2023 still nonsense) .
1:Lower priced JK Models had lower take rates, while models with higher trim levels with options sold better.
2: The company believe that historically the Wrangler was underpriced , decisions to take actions to correct the underpricing was made back in 2015.
3:2015 decision was made Wrangler needed more Options/Trims/Packages

 

[cygnus]

It was one time, pent up demand for Gladiator.

Other than the eventual launch for JM later this decade, Wrangler + Gladiator sales are going to be 150Kish per year (probably 180-190K this year, slowly sliding down to 150K over the remainder of their current platform lives), if STLA is lucky, going forward.

Shifts will be cut at some point, this year potentially.

 

[patfromigh]

Maybe the PSA side of the house has problems building a less expensive EV, but I suspect the FCA side can and will. That is only if the management team lets them.

 

[ChargerFan1]

I'm seeing 0% interest ads again here for Jeep...

Having said that, the 2023 MSRP jump for the WL TH is wild

0% in this climate just shows how overpriced they are because they are eating the rates in form of discount. I bet they're discounting even more too and if they aren't they will be.

 

[UN4GTBL]

0% in this climate just shows how overpriced they are because they are eating the rates in form of discount. I bet they're discounting even more too and if they aren't they will be.

The pricing here is just out of this world.

The MSRP on my February 2018 ordered 2019 Trailhawk Elite was $50,400 less my discounts and before and it was ordered during a 48 month 0% financing program.
A 2023 Cherokee Trailhawk Elite with similar options is now $58,500 + tax at 4.49% for 48 months according to Jeep.ca right now.

I won't even start on the WL price or the Hornet price. Heck, a 2022 Compass Trailhwak Elite is priced the same as the sticker was on my 2019 KL but it has that awful tigershark engine. Not sure what the 2023 price is as jeep.ca build & price hasn't been updated yet lol.

The value I got in my 2019 KL is what drew me to it, (and that it was comfortable) and that fact still stands 5 years later.

 

[ChargerFan1]

The pricing here is just out of this world.

The MSRP on my February 2018 ordered 2019 Trailhawk Elite was $50,400 less my discounts and before and it was ordered during a 48 month 0% financing program.
A 2023 Cherokee Trailhawk Elite with similar options is now $58,500 + tax at 4.49% for 48 months according to Jeep.ca right now.

I won't even start on the WL price or the Hornet price. Heck, a 2022 Compass Trailhwak Elite is priced the same as the sticker was on my 2019 KL but it has that awful tigershark engine. Not sure what the 2023 price is as jeep.ca build & price hasn't been updated yet lol.

The value I got in my 2019 KL is what drew me to it, (and that it was comfortable) and that fact still stands 5 years later.

My moms 2015 trailhawk MSRP was 41K and I got it for her at 31K. Ontario. Yes, they have lost the plot with pricing, and me as a customer.

 

[AlexB]

It was one time, pent up demand for Gladiator.

Other than the eventual launch for JM later this decade, Wrangler + Gladiator sales are going to be 150Kish per year (probably 180-190K this year, slowly sliding down to 150K over the remainder of their current platform lives), if STLA is lucky, going forward.

Shifts will be cut at some point, this year potentially.

“One time “is complete BS, 2019/2021/2022 proved that
Again you ignore that nearly ATP $60,000 (JL+Gladiator) VS mid -to-high $30,000 with JK is way better financially for FCA/Stellantis.

 

[TripleT]

Guys inside baseball here... until the battery plants lower the logistics price, it going to be high manufacturing price. Some of you here know what I do.

Right now, batteries are being shipped in custom expendable dunnage, lonnnnnnnng distances.