Stellantis CEO Shows Optimism with Brazil But Says that Improvement Depends on Vaccination
Stellantis CEO shows optimism with Brazil, but says that improvement depends on vaccination; company denies brand exclusion
The group’s factory in Minas Gerais went on collective vacation due to the lack of components. Production and sales were hampered by the pandemic.
On his first visit to Brazil as CEO of Stellantis, a company resulting from the merger between Fiat Chrysler (FCA) and Peugeot-Citroën (PSA), the Portuguese Carlos Tavares showed optimism with the group’s operations in the country and in Latin America. He classifies the region as having “great potential”.
Understand how the billion-dollar merger between Peugeot and Fiat gave rise to Stellantis
For the head of the fourth largest automotive group on the planet, the year 2021 will be an improvement in conditions in the Brazilian market with the resumption of production and sales, which were hampered in 2020 with the arrival of the coronavirus pandemic.
Tavares, although optimistic, added that “the speed of these changes is unknown”, pointing out that the market improvements will depend on how the vaccination against Covid-19 will evolve in Brazil, and how it will affect the regression of the pandemic here.
Collective vacations in the midst of the crisis
Earlier this month, Fiat, one of Stellantis’ brands, announced a collective vacation for 602 employees in Betim (MG), reportedly for adjustments in production due to lack of components. The problem strikes the global automotive industry, and involves inflation in the price of steel and the scarcity of semiconductors.
The value of steel has gone through successive hikes and has pushed the final value of vehicles. For Stellantis, Tavares said that there is still an absorption of values by the company, but he fears for the need to pass the higher value on to the final consumer.
Semiconductors, on the other hand, are lacking due to an increase in demand for technology devices such as smartphones and computers during the pandemic. In view of this, component manufacturers give priority to technology companies, leaving automotive companies in the background.
Presence in Latin America
Regarding Latin America, led by Antonio Filosa (formerly president of FCA in the same region) Carlos Tavares says he is “very comfortable” with regard to operations.
“We have already learned, as a company, to deal with this volatility characteristic of the region. The local teams have already learned to deal with this, we have an approach that is very positive”, he said when asked by G1 about how he sees the future of Stellantis in Brazil .
“It is a region with great volatility, but with great potential,” he added.
The company’s CEO also highlighted the production capacity in the region, in addition to the strength in the Brazilian market, where it is the leader.
In the last month of February, Stellantis’ sales represented 30% of the total sales of automobiles and light commercial vehicles in Brazil.
Still in 2021, the company intends to reinforce its offensive with several launches, including new models and changes in half-life.
Brands will not be discontinued
One of Stellantis’ biggest highlights is the number of brands formed by the merger. There are 14 in all: Fiat, Chrysler, Maserati, Jeep, Abarth, Alfa Romeo, Lancia, Dodge and Ram, from FCA, as well as Peugeot, Citroën, Opel, Vauxhall and DS, from PSA.
According to Carlos Tavares, in principle, the company’s intention is that none of the brands is discontinued.
“We have passion and respect for our brands,” said Tavares.
On the other hand, the executive did not rule out changes in the portfolio of brands in specific regions and said that the commanders of each region have the autonomy to decide the best strategy. This goes for removing or adding brands.
Regarding rumors that Stellantis would remove some minor brands, Tavares pointed out that some brands had difficulties because no investments were made for them, but that each one will now have its specific strategy.
As part of the synergy and cost-cutting strategies, Stellantis’ factories will be used by any brand in the group that is able to manufacture models that use the same platform.
That is, from now on, Fiat and Peugeot models will be able to be produced together, as long as they are based on the same platform.
Last Wednesday (10), with the presence of Tavares and Filosa, the FCA plant in Betim (MG) started production of the new line of turbo engines that will be able to equip the next launches of any of the brands.
For the unit, which becomes the largest engine production center in Latin America, R $ 400 million was invested, and another R $ 100 million is foreseen for the
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