Auto File: Fall of the house of Carlos
By Nick Carey, European Autos Correspondent
Greetings from London!
Well, almost Paris, where I attended this year’s car show on Monday this week with other Reuters autos colleagues.
While smaller car shows are struggling - poor Geneva's motor event is no more - Paris was hopping. Chinese companies were there in force trying to get a foot in the door in Europe, going toe to toe with homegrown European automakers defending their home territory.
Consumers in Paris can now come face to face with new, virtually unknown brands, including Aito, Hongqi (“Red Flag”, Chairman Mao’s favourite brand), GAC, Leapmotor and Xpeng.
Chinese auto executives radiated optimism, though BYD did take the time to slam the European Union’s planned tariffs for Chinese-made EVs.
Which brings us to today’s Auto File…
End of the road for Tavares, almost
A robotaxi, someday, from Tesla
BMW’s Zipse: scrap 2035 fossil fuel ban
Carlos’ long farewell
The last couple of weeks have moved fast for Stellantis CEO Carlos Tavares.
After a hefty shock profit warning on Sept. 30 because of spiraling inventory problems in Stellantis’ cash-cow U.S. market, Tavares initially downplayed the matter, calling it a “small operational error” even as the company’s shares continued a stomach-churning dive.
Just over a week after those fateful words, Stellantis announced Tavares will retire when his contract expires in early 2026. For an executive who seemed invincible just a few months ago, this was a rapid turn for the worse.
Tavares appeared at a handful of briefings at this week’s Paris car show to defend his record and talk up Stellantis’ future, promising that its U.S. inventory problems will be solved by Christmas (translation: huge discounts on Jeeps, Rams, Dodges and Chryslers coming your way).
While acknowledging that as CEO he is responsible for things that go wrong at Stellantis, Tavares said the inventory problems came down to a “risky” second-quarter marketing plan by regional U.S. managers that he saw but did not overrule.
The problem with that argument is that according to inventory data provided to Reuters and commentary from experts and Stellantis’ U.S. dealers, the automakers’ problems have been years in the making.
Industry experts and dealers say Stellantis spent years pricing itself out of the market, under investing in new U.S. product. It was then slow to discount vehicles as they piled up on dealer lots. You can read about it here.
Recommended reading:
French brandy makers fear EV tariff fallout
Trump’s car loan tax giveaway
India bids farewell to Ratan Tata
Someday, Tesla robotaxis should come
Some investors had real questions in the runup to Tesla’s robotaxi event last week and were especially keen to know how soon they could be mass produced and turn a profit for Elon Musk’s company.
At a glitzy unveiling, Musk boldly proclaimed that the “autonomous future is here.”
But it’s not quite here. The “Cybercab” should theoretically go into production in 2026, though Musk acknowledged his optimism with targets (see the Cybertruck, announcements on self-driving cars in 2016, 2019…).
Investors were underwhelmed, especially by the scant details provided by Musk, and Tesla’s shares fell 9% the next day.
Industry experts and investors were also puzzled by the robotaxi’s design – a low-slung, two-seater, sporty coupe - quite unlike a typical taxi with room for several passengers and luggage.
It is also not clear how much demand there is for two-person, self-driving taxis. Musk has proclaimed this is the future.
But the company’s future has so far been predicated on filling up the production lines at expensive Tesla factories in the United States, Germany and China.
So, it is little wonder some investors were left wanting more.
BMW’s Zipse: ditch EU fossil-fuel ban
Speaking at the Paris car show on Tuesday, BMW’s Oliver Zipse became the first European auto CEO to call for the EU to cancel its 2035 ban on fossil-fuel cars.
BMW’s top executive argues that Europe’s laser focus on switching to only EVs as an alternative to combustion-engine cars will only benefit Chinese rivals, who dominate the battery-making industry.
Zipse has previously argued for alternatives to electric vehicles to be allowed, such as hybrids, e-fuels and hydrogen fuel cells.
But this time, the German premium automaker’s CEO said the mood in Europe was "trending towards one of pessimism" and the region needs different regulations to remain competitive.
At the same event, the head of France's auto association PFA stopped short of calling for the 2035 ban to be abolished, but added it was necessary to quickly "come back around the table" for a review of the EU’s targets that is currently scheduled for 2026.
Hyundai’s IPO a biggie for India
Hyundai Motor India sold shares worth $989.4 million to institutional investors including BlackRock and Fidelity this week, in a $3.3 billion IPO that makes it India’s largest share offering yet.
The IPO shows continued enthusiasm for India's capital markets, with 260 companies having raised more than $9 billion so far in 2024, according to LSEG data. The year-to-date volume has already surpassed the $7.42 billion total raised last year.
Investors included the government of Singapore, BlackRock and Fidelity.
You can read about it here.
For more on all the latest big stories out of India, check out India File, a new Reuters newsletter.
Fast Laps
Volkswagen reported a 7% drop in third-quarter global deliveries, in a fresh sign of trouble for the giant German automaker.
Swedish battery maker Northvolt is trying to sell off its stockpile of battery-making materials as it tries to shore up its finances. Separately, Northvolt said it has paid a monthly tax bill for October, as doubts emerged in media on whether the cash-strapped group would be able to do so.
EV startup Fisker received court approval for its bankruptcy liquidation plan following last-minute negotiations to preserve the company's $46 million sale of its remaining inventory of about 3,000 Ocean SUVs.
United Auto Workers president Shawn Fain says hundreds of thousands of U.S. jobs are at stake if Republican former President Donald Trump wins the Nov. 5 election and makes good on his threat to overturn EV investments.
Italy's government says Stellantis’ robotics business Comau will have to preserve production plants and central functions in Italy as conditions for the sale of a majority stake in the company to One Equity Partners.
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Editing by Emelia Sithole-Matarise
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