Marchionne, who plans to retire in 2019, said recent global scandals involving diesel engines emitting excessive emissions played a major role in the recent rise of electrified vehicle announcements.
However, Dr Peter Harrop, Chairman of leading analyst IDTechEx cautions,
"Electrification is a term that falls short of a dash to pure electric vehicles. For example, Toyota
recently decided urgently to create top priority pure electric vehicle activities. Apparently they are conceding that Tesla
has the right strategy but they remain active in all EV options. To its credit, Fiat Chrysler Automobiles, like Daimler, is a leader in 48V mild hybrid development. This is a relatively quick fix for conventional cars otherwise likely to become illegal under impending emissions laws. See the IDTechEx Research report, Mild Hybrid 48V Vehicles 2017-2027
"going electric", much of the newly trumpeted change at FCA seems to include 48V mild hybrids and these are not electric vehicles as the added electric motor starter generator never powers the wheels directly."
Indeed, Marchionne's comment was, "Some type of electrification on gas engines is inevitable."
FCA has been a late adopter of electrified powertrains due to their perception of cost and lack of demand. The company currently only offers a plug-in hybrid version of its Chrysler Pacifica and an all-electric model of the Fiat 500, which Marchionne told consumers not to buy because he said FCA loses thousands of dollars on each sale.
Marchionne's change of heart comes as some countries have announced plans to ban gasoline and diesel cars in the coming years, including Norway and Netherlands by 2025, India by 2030 and the U.K. and France by 2040. This usually includes internal combustion engine use in hybrids.
The issue impeding FCA's electrified future, according to Marchionne, is the poor reduction in variable production costs. He believes that a huge increase in pricing will be needed in 2021-2022 that will cause a shrinkage
of demand. This is in stark contrast to some other car companies predicting pure electric car cost parity with conventional in only a few years: the killer blow.
"Part of the difference may be explained by the fact that FCA does not plan to make its own batteries
and some other components that some competitors will make to contain costs. In addition, it may not achieve the economy of scale of the leaders," observes Harrop.
Marchionne said Maserati will lead his electrification which is not surprising because the Tesla S came from nowhere to outsell all premium models in the USA. He promised that all new Maserati models following 2019 will be electrified, including launching all-electric models capable of competing against Tesla.
"When it completes the development of its next two models, it will effectively switch all of its portfolio to electrification," he told analysts and journalists during a recent conference call to discuss FCA second-quarter earnings. "It's an integral part of the development of all of the group."
That will be far from Maserati's zero electrified models today, its conventional engines coming from Ferrari, which Marchionne last year said would experience a "fundamental shift" toward hybridization beginning in 2019. Indeed, the LeFerrari model is already a full hybrid.
FCA will disclose additional product plans early next year during an investor day to outline its newest five-year plan through 2022.
So who is really leading the industry forward?
Harrop says, "In the accelerating move to pure electric, Tesla and Renault Nissan
in cars and BYD
in buses take some beating in these, the largest addressable value markets. In autonomy, many are progressing well but this is only a necessary evil because it does not grow the overall market on our analysis. The next big thing after those is energy independent vehicles. It will be huge and Toyota and Tesla certainly have the message with the lesser known Hanergy
, Sono Motors
and others doing significant work for land-based applications."