WionDrive News Desk 
In a move to maintain profitability and safeguard against potential takeover risks, Stellantis CEO Carlos Tavares emphasised the company’s commitment to avoiding aggressive price cuts that could compromise the industry’s financial stability. During the presentation of Stellantis’ latest platform for large battery electric vehicles (BEVs), Tavares expressed concern about the impact of ruthless price wars on overall industry health.
Tavares acknowledged Stellantis’ comparative resilience as one of the most profitable companies in the automotive sector. He stressed the importance of avoiding a “race to the bottom” by refraining from pricing strategies that disregard the reality of production costs. Tavares cautioned against the consequences of such aggressive tactics, citing an unnamed company that experienced a sharp decline in profitability after engaging in brutal price cuts.
The CEO’s comments come in the wake of rival BEV maker Tesla’s recent decision to slash prices for its Model Y across Europe, responding to uncertainties in the electric vehicle market. Tavares, however, asserted that Stellantis would prioritise maintaining profitability over engaging in drastic price reductions.
Addressing concerns about disruptions in shipping routes, particularly in the Red Sea, Tavares downplayed potential impacts on Stellantis, emphasising that any delays in supplies would primarily extend travel times. While acknowledging possible discussions on mitigating increased costs due to extended routes, he reassured that, at this stage, Stellantis was not significantly affected.
Contrary to some competitors, Tavares stated that Stellantis had not encountered major issues related to Red Sea disruptions, and operations were proceeding smoothly. Tesla and Volvo Car recently announced production suspensions in Europe due to component shortages resulting from shipping problems in the Red Sea.
Despite potential challenges, Tavares affirmed that the disruptions would not prompt changes in Stellantis’ sourcing strategies. Stressing the importance of supplies from the Far East for the affordability of electric vehicles, he asserted that meeting the demand for affordable BEVs remained a key focus for the company.
Tavares underscored the significance of maintaining competitive prices to meet Western consumers’ expectations for affordable electric vehicles while ensuring that Stellantis remains resilient in a rapidly evolving automotive landscape.
