As Stellantis seeks to regain its market share, Emanuele Cappellano, the company's new European chief executive, warns that without urgent legislative changes, the region's automotive industry faces a bleak future characterized by declining volumes, declining margins and potential long-term risks to factories, Les Echos reports.
He supports the principle of minimum European content, arguing that it can strengthen local industry only if it remains affordable; its implementation too quickly, especially for batteries, where Europe does not have scale, will simply increase the cost of cars by 10-20% and worsen demand. The executive estimates the cost difference between Chinese and European cars at about 30%, driven by subsidies, cheaper batteries and electronics, fully localized Chinese supply chains, and structural differences in energy, labor, and regulation.
Even with technological advances, Europe cannot overcome this difference without strong support from the European Union. Mr. Cappellano notes that since 2019, car prices have increased dramatically due to the increased cost of content, which has led to the disappearance of offers worth less than 15,000 euros and has hit entry-level buyers the hardest. Margins briefly improved after the pandemic, but disappeared due to overcapacity, and compliance costs are forcing manufacturers to choose between fines or selling electric vehicles at a loss, which is especially acute in the case of commercial vehicles, where the total cost of operation contributes to the use of internal combustion engines.
