In 2016 Peugeot announced it was strongly considering a return to the U.S. market. Back then we reported that the PSA Group was planning to engineer its next-generation of vehicles to meet U.S. regulations as part of its planned return to North America. We quoted CEO Carlos Tavares, speaking at the Frankfurt show, saying, “That means that from three years down the road we’ll be able to push the button, if we decide to do so, in terms of product compliance vis-a-vis the U.S. regulations.”
Fast forward to last month and PSA Group and FCA officially became one, creating Stellantis. It is the fourth-largest automaker in the world by volume with 14 very different brands including Chrysler, Fiat, Dodge, Alfa-Romeo, Jeep, Ram, Peugeot, Maserati, Opel, and Citroën. CEO Tavares is now saying Peugeot’s arrival here is delayed, and the company hasn’t decided if it is coming at all.
“In April, 2016 we said within the next 10 years PSA will come back to the U.S. market,” Tavares said in a virtual media round table. “Since then many things have changed. We bought Opel/Vauxhall, made the merger with FCA, and we have a very strong position in the U.S. market with very strong brands. We already have many brands to take care of. Most probably we’ll make a decision to suspend bringing Peugeot to the U.S. market.”
He said for now it’s better to focus on the brands Stellantis already operates here and he realizes some need help. “Some of them have the opportunity to rebound in a strong way, and we are working on the plans to turn those brands around and improve what needs to be improved.
“It doesn’t mean [Peugeot] will never happen,” he added, “but for the time being I don’t think it’s something we want to prioritize.”
He said for example one of the next steps is to strategically think about what the next step is for Chrysler, a brand he said needs to rebound. “It’s one of three historic pillars along with Fiat and Peugeot,” he said, adding that Stellantis needs to have a clear vision and destination for its three pillars. The next steps, he said, are to set up a strong brand team that will come with a proposed long-term business plan to show that it makes sense to invest in [Chrysler].
Tavares, a racer, car fanatic, and rally enthusiast, also said EVs are a focal point for the new company. Stellantis has 29 electrified vehicles on the market at the moment, including fully electric and hybrid vehicles, and will offer 39 by the end of 2021. By 2025, Stellantis will produce one electrified model for every newly launched global model. They won’t come, however, at the expense of performance, Tavares said.
“At the end of the day we have to have the dynamics, the acceleration, and being in control of the machine. Electrification will be needed but electrification is all about torque. And torque is what we need to create cars that deliver the emotion.”
He said packaging, particularly battery packaging, can improve a vehicle’s dynamics by lowering the center of gravity. Combine a low center of gravity with gobs of torque and you’ll have very agile products. He said one of the assets Stellantis brings to the table is a powerful understanding of electrified technology, whether it’s electric motors, electronic transmissions, or battery packs.
“As a motorsports fanatic,” he said, “I can assure you great dynamics can be protected while significantly reducing CO2 emissions.” He cited Peugeot’s new 508 Peugeot Sport Engineered sedan, a 360 hp, all-wheel drive rocket with PHEV technology. “The car is very thrilling,” he said, adding the company is committed to offering “freedom of mobility to our customers that is safe, clean and affordable. We will do what it takes to keep our customers happy. ”
Speaking of motorsports, we asked Tavares about where Stellantis is headed in terms of racing. He said he considers it a great marketing tool and one of the ways to support the brands. It will be studied and addressed in a very business-oriented way, he said.
“Motorsports is one of the marketing media,” he said, “so it is in competition with other media such as TV ads, magazine ads, digital campaigns…and we have a specific way to calculate motorsports’ return on investment. As long as motorsports keeps a good audience and keeps control of costs, we can protect the overall effectiveness of motorsports as a marketing tool.”
He said if racing doesn’t keep good audiences and doesn’t control costs then motorsports would lose its effectiveness as a marketing tool compared to the other media, and Stellantis would have to re evaluate.
“We have Alfa Romeo in Formula 1, the premium French DS brand has won two Formula E championships in a row, and we’re preparing the Peugeot prototype for WEC in 2022. More opportunities will come along, again, as long as the ROI is protected by cost-efficient solutions.”
Tavares said overall the automotive industry’s biggest global question mark is how much time will automakers be given to adapt to whatever new stringent rules are introduced, and to what extent will automakers be allowed to contribute to setting them.
“The most difficult part of our job right now is to understand and try to anticipate what is going to be the objectives for 2025, 2030, and beyond. Not just CO2 but autonomous vehicles and all the rest.”
He said Stellantis is having good, collaborative dialogue with the Biden Administration. “We are trying to contribute with the best of our knowledge to setting the right thresholds to make sure we are contributing actively to fight global warming.”
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