Stellantis CEO Carlos Tavares warns European lawmakers that broadening legislation may undermined path towards EVs.
Stellantis boss Carlos Tavares has called on government legislators to stick to a set of stable future regulations for the automotive industry and avoid adding anything that adds “confusion to chaos”.
Speaking to Automotive Daily Network partner Autocar on a visit to Vauxhall’s Luton factory, Tavares was reacting to the European Union’s plans to allow e-fuel-powered internal combustion engined cars to be exempt from laws that will see only electric cars allowed to be sold from 2036.
Tavares said he welcomed e-fuels as a way to power the 1.4 billion non-electric cars that will be on the roads, even if a full switch was made to EVs for new car sales, and, more generally, an interesting future fuel that his internal combustion engines were already compatible with.
But, he highlighted that the broadening of legislation for e-fuels undermined the regulatory path already set towards battery electric cars at the very time when investments and implementation plans had been set for the next 20 years.
“The first scenario is they don’t break the paradigms,” said Tavares on whether e-fuels can prove to be truly carbon neutral and brought down dramatically in cost. “Then we are safe, and we keep on pushing the EVs.
“The second scenario is they break the paradigms. What do we do [then]? Because we still have 12 years, right [before the 2036 ban]? What happens if some of those guys come up with a breakthrough and they say we found a way to reduce the manufacturing costs of the e-fuels tremendously, and now without tax they are in the similar playground?
“Do I have the answers to these questions? No. But you see, this is the big problem of what we are doing. To execute the current strategy you need 20 years. What is the probability that within a 20-year time window nobody comes laterally with a breakthrough saying “I found something which is a much lower cost for the society, a much better result for the planet and much easier to execute?”
Tavares’s underlying point is one against politicians setting regulations that are not technology agnostic, and there are alternative ways to reduce emissions.
He said: “There is no dogma, it’s just about the fact that we have been working for a century in the fine tuning of technology. And then suddenly, the outside world would like us to make the same efficiency with a brand new technology that has a very limited amount of time to be optimised.
“Politicians are very respectful, [but] I’m not really sure they are listening. I’m just sharing this observation, not in an aggressive mode because I would not like to be a political leader nowadays. I think that’s an impossible job. So my respect to them. But at the same time if nobody asks the difficult questions, then who will?
“I’m fine to go full speed on EVs, and demonstrate to the world that I am the best EV maker. I’m playing that game, full power in a regulatory framing that is given to me. Then the question: is this regulatory framing the best for the societies? Is that the best for the planet? And then we could write a book about that.
“On E-fuels, we have made sure that our engines are e-fuel-friendly, just in case. Now we are going to let those stakeholders demonstrate that the fuel is really carbon neutral and that one day, the costs can be the same level.
“It’s funny, because from a political perspective, what do they say? They immediately go on ‘communications’ about saying, well, that’s the fuel for the rich. That’s a very attractive communication because if you say it’s for the rich, everybody will say: ‘Oh, okay, we don’t care, it’s just for the rich’.
“What if there is a breakthrough? What will we do with the gigafactories? What do we do with all the transformation that we have been making as an industry, who is going to pay for that? And when they [politicians] see that risk, they start saying: ‘well, we did not impose the technology’. What! What are you saying? You see the legal stuff coming? This is a question that you should be raising.”
Tavares said he had no concerns over Stellantis’s ability to survive and thrive no matter the regulations, and said the firm would be “one of, if not the only survivor”. Instead his broader concerns were with the disruption it would have on societies due to the flip-flopping of legislation and the instability it caused a huge industrial industry employing millions of people.
“I’m worried about society, I’m worried about Europe, I’m worried about the Western world, which means if you want to bet that everything is going to be steady for the next 20 years you are making a big bet. So nothing is going to hurt the smooth implementation of a strategy that needs 20 years of stable conditions?”
On other topics, Tavares didn’t rule out a gigafactory for Stellantis in the UK but that the decision was ultimately in “the hands of those who decide the size of the market” and as such “was not a Stellantis question”. He said he was open to adding to the five gigafactories already committed by the firm to anywhere that had access to clean energy, the right logistical costs, and not trapped by raw material sourcing regulations.
He said that the firm was already making good progress towards its goal of being carbon net zero by 2038, and had dropped emissions by 30% since 2019. By next year half of Stellantis’s new car portfolio would be EVs but “customers will decide” whether that equates to half of sales, another reference to customer demand not being there for EVs yet for affordability reasons.
Tavares would continue to invest in meeting EU7 emissions regulations but only as “minimum amount of resource” due to the investments needed to go EV.
“Any resource – rare resource – that you would dedicate right now to EU7 will be to the detriment of electrification. Does it make sense? Or is it a sign of hesitation?”