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2018 Detriot Motor Show: FCA fence-sitting on electrification, autonomy

By Daniel Gardner, 17 Jan 2018 Events

2018 Detriot Motor Show FCA fence-sitting on electrification autonomy

Marchionne remains ‘agnostic’ on alternative energy and self-driving technology

FIAT Chrysler Automobiles (FCA) CEO Sergio Marchionne has used a typically unapologetic tone to reiterate the company’s stance on electrified vehicles and the technology that many other manufacturers claim will result in self-driving vehicles as early as 2019.

While almost all brands are claiming some form of driverless capability for vehicles within the next few years, the boss of the Italian/American automotive giant has used what may be one of his last media addresses to make it clear that FCA will not be adopting electrification or self-driving ambitions any time soon.

Speaking to the press at the North American International Auto Show, Marchionne said he was not yet convinced that the pursuit of autonomy and electrified vehicles made business sense, and had a stab at the brands that are taking a different approach.

“I don’t know of a guy or an entity or an organisation who is making money out of selling electric vehicles,” he said.

“I’ve heard all the announcements especially at shows like this, and whenever we go to auto shows the intensity with which we make these proclamations is without explanation.

“We can’t fool ourselves into talking about a reality we don’t understand, so these proclamations about the advent of electrification and the inevitable association of artificial intelligence are all things that are, at best, conjecture.”

It is widely known that the path of self-driving cars will not be obstructed by technological constraints but by the legislation necessary to unleash them into the wild. Marchionne said the delay would be far longer than many are speculating.

“The reference to the fact that these autonomous vehicles run the risk of being weaponised is one additional risk that will come up in the dialogue from us and the regulators about how to implement the technology in these cars.

“That process, even by itself, is a lot longer than people forecasted. So when people document the fact that we’ll have robotised cars on the road by 2019, it may be physically true in the sense that there are five vehicles out there, but we sell 17.5 million vehicles in this country a year.”

Until potential volumes of autonomous or semi-autonomous cars can reach a profitable tipping point, Marchionne explained that FCA vehicles would be piloted by flesh and blood, leaving other brands to explore the unchartered territory.

“The question is, is the preponderance of vehicles going to be robotised vehicles, and the answer is no. Are the majority of them going to be electrified, and the answer is no.

“I will continue to repeat that I am technology neutral,” he said.

As for electrification, Marchionne made no specific reference to Australia’s unique automotive landscape, but with zero buyer and owner incentives for electrified vehicles and meagre infrastructure, local prospects are likely to fall under a similar umbrella as in the US.

According to Marchionne, Europe has better prospects for adopting electric cars, but market potential in continental Europe was not enough for the company to make EV commitments while the United States is responsible for its predominant sales volume.

“Strangely enough, as a component the powertrain structure is going to become a lot more relevant in Europe than it is [in the US] and much faster. So making an announcement at the Detroit auto show that we’re going to have X number of vehicles electrified in the future may be true, but is it a wise economic thing to say? And the answer is probably not.

“Is there any guarantee that we are creating a new economic policy that is effectively sustainable and is defensible going forward, and the answer is no.”

When asked how the company intended to meet increasingly strict emissions regulations in Europe if it consistently abstained from EV and hybrid models, Marchionne said FCA products would continue to be powered by combustion powertrains until an obvious alternative prevailed.

“We have refused to engage in public declarations of our love or lack of love for electrification simply given the fact that we remain agnostic on the choice and we want to be absolutely free to choose whatever is most appropriate in the circumstances.”

Far from being dismissive of carbon reduction plans, Marchionne said the company was striving to cut its vehicle’s CO2 emissions, but said he wasn’t convinced electric cars were the best approach.

“We don’t have a gun to our head. We do have very clear emission ambitions that are totally consistent with regulations in sight.

“The choice of electrical by itself may not be the answer. I don’t think we have answered the CO2 issue on electric. We just haven’t.”

In the worst case, the FCA head said its more polluting models would simply be pulled from European showrooms and, in a statement of apparent defiance, Marchionne said the tight EU standards were nearing an impossible level.

“[FCA Europe] will stop selling cars,” he said. “The great thing about Europe is that the punitive side associated will not comply. It’s so hard that it’s not working. We’ll just stop selling cars.

“It’s the only way you can do it. The fines associated with non-compliance… I’ve got a compliance officer and we’ve gone through this. It ain’t pretty. It really is not nice.”

Marchionne concluded by saying he believed such drastic action would not become a reality, and acknowledged that electrification will become mandatory in Europe.

While that means the future of FCA’s model line-up is safe in the US and most likely Australia, for now, Europe’s strict carbon rules may soon mark ground-zero for the start of FCA’s electrified future.

Sergio Marchionne will retire this year. His replacement is yet to be announced.