Pressure on automakers to develop EVs could bring major consequences.
One consequence could be major job losses.
The timelines are extremely stringent.
The external pressure put on global automakers to develop and deliver more EVs in the next decade or so is excessive. Stellantis NV Chief Executive Carlos Tavares believes that there are huge risks involved in fast-forwarding electric vehicles on top of the still higher costs to do so.
Of the involved and potential risks, Tavares says that automakers require time to engineer and test these new technologies. Stellantis will boost productivity at a pace far higher than industry norms. From the typical 2-3%, they will run at a staggering 10%. This will be one way to avoid job cuts but it represents a huge cost increase.
“What has been decided is to impose on the automotive industry electrification that brings 50% additional costs against a conventional vehicle,” Tavares said to Reuters. “There is no way we can transfer 50% of additional costs to the final consumer because most parts of the middle class will not be able to pay.”
As some countries have announced the ban of new ICE sales as early as 2030, speed is of the essence. This could lead to quality issues and potentially numerous other related problems. These circumstances could snowball into lower profit margins and eventually to thousands of job cuts.