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Stellantis NV plans to manufacture an all-electric version of its popular Ram truck at a factory in the US, according to its chief executive officer.
The company, which owns the Jeep and Ram brands, will announce the production location soon, CEO Carlos Tavares told reporters Wednesday on the sidelines of the New York auto show. He did not provide further details.
Stellantis plans to start output of the battery-powered Ram model, called the Revolution, from next year. It will compete against Ford Motor Co.’s F-150 Lightning truck and an upcoming electric version of General Motors Co.’s Silverado, as well as Rivian Automotive Inc.’s R1T model and Tesla Inc.’s upcoming Cybertruck.
Automakers have an incentive from President Joe Biden’s Inflation Reduction Act to build vehicles and batteries in the US or with the nation’s free trade partners in order to be eligible for up to $7,500 in consumer tax credits.
“We source locally where we sell locally,” Tavares said.
He has bemoaned the premium costs to build electric vehicles in the US — potentially 40% higher, he said — and the thinner margins while the industry and its supply base build a critical mass.
“How do we tackle those” additional costs, Tavares asked. “If we don’t do it, we will have significant reduction in the market because the middle class won’t be able to buy EVs. Everybody would lose from that situation.”
Cost cuts could pit Stellantis against the United Auto Workers union this year when the two sides bargain for a new contract. New union President Shawn Fain ran on a campaign to bargain for a fair share from automakers.
The company idled an assembly plant in Illinois and has been making other cost cuts. The union is irate over the factory halt, which could set the stage for tense talks and raise the possibility of a strike.
“I’m not concerned. It’s a part of the negotiating process,” Tavares said. “Our company did not create Covid, our company did not create the semiconductor supply issue. Our company did not create harsh regulations. The union understand this.”
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