The CEO of Jeep maker Stellantis NV on Tuesday joined the chorus of voices in the auto industry warning about a future shortage of electric-vehicle batteries without more production in Europe and the United States, potentially risking the transatlantic automaker's EV commitments.
"We can anticipate that we will have around 2025, 2026, a short supply of batteries," Carlos Tavares said remotely during the Financial Times' Future of the Car summit. "And if there is no short supply of batteries, then there will be a significant dependence of the Western world vis-à-vis Asia."
Tavares emphasized under such a scenario, the cost of EVs would remain high. That could jeopardize the ability for many customers to afford them, and shrinking demand could harm automakers like Stellantis and its ability to employ the 300,000 people it does. Tavares called on Western nations to take a "360-degree approach" to a carbon neutral future that includes ensuring secure access to raw materials, clean energy production and a charging networks for EVs.
"'Is this going to be growing at the speed that the regulations expect us to grow?' is indeed a risk moving forward," Tavares said in response to a question about comments from Volkswagen AG CEO Herbert Diess on Monday that Europe won't be able to support 100% EV sales by 2030 — which is Stellantis' goal.
More and more automakers and battery manufacturers, however, are announcing investments for production of batteries in Western nations. As a part of its plans to invest $35.5 billion in electrification and software by 2025, Stellantis has announced battery plants in France, Germany and Italy to support European vehicle production and another in Windsor, Ontario, for North America. A second in the United States is expected to be announced in the coming weeks. It plans to have 400 gigawatt hours of total capacity on the two continents by 2030.
"Manufacturing capacities for batteries," he said, "is possibly on the edge to be able to support the fast-changing markets in which we are operating."
The transforming industry also reveals another question automakers must face: What happens with employees skilled in internal combustion engines and other retiring technologies?
Ford Motor Co. has announced its intention to separate its traditional "Ford Blue" business from its new "Model e" enterprise to help accelerate that transition. That's not the direction Stellantis will go, Tavares said.
"We see that some companies would like to go on old co., new co. kind of break down. Our position is quite different from that," he said. "For the people who have been creating wealth and value over the last 50 years, for the communities in which we operate, for our own company, it is not ethical to wake up in the morning and discover that you are on the wrong side of the line."
Some people will retire or move onto other jobs, Tavares said, but he emphasized the importance of bringing along Stellantis' employees and helping them to make that transition. The automaker already has shared plans to train 1,000 engineers per year through a software academy with Amazon.com Inc. Tavares said Stellantis is looking to have similar programs for data crunching and new manufacturing processes, as well.
"It's important to tell them that we want to bring them along with us because we believe in their learning capabilities," he said. "The most important thing is to tell them that we love them. We want to bring them along with us."
