French auto parts supplier OPmobility says many carmakers are reviving development plans for combustion-engine cars amid slower-than-expected demand f
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French auto parts supplier OPmobility says many carmakers are reviving development plans for combustion-engine cars amid slower-than-expected demand for electric vehicles, with buyers put off by regulatory uncertainty and stubbornly high prices.
Volumes of EVs produced by US, German and French manufacturers are currently 40 per cent to 45 per cent below initial expectations, “which means the capacity that had been put in place by our clients and by ourselves requires continuous adjustment,” Chief Executive Officer Laurent Favre said. “We are adapting the way we work with our clients.”
Europe’s EV shift has faltered due to high prices and the removal of subsidies by a number of governments. The setback is prompting companies like Mercedes-Benz Group AG to push out EV sales targets while battery makers are reviewing projects. Stellantis NV has currently halted EV output at its Mirafiori plant near Turin, and Volkswagen AG this month started proceedings that may see it shut a factory in Belgium making the electric Audi Q8 e-tron. Another French auto supplier, Valeo SA, is seeking buyers for two plants.
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In the US, Ford Motor Co. said last week it would invest $3 billion to build its highly profitable Super Duty F-Series pickup truck at a plant in Ontario, Canada, shifting focus at the site after previously delaying plans for an electric sport utility vehicle.
“There also is renewed interest for hybrids and plug-in hybrids,” Favre said. “Some of our clients, notably in the US, had planned to shift directly from classic combustion engine vehicles to EVs and now they are focusing on plug-in hybrid development.”
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OPmobility confirmed its full-year targets on Tuesday even though Favre says he remain “cautious” on the outlook for the rest of the year. “There is still a lot of uncertainty on volumes and the market’s development,” he said. “The shift to electric was imposed by regulators, it didn’t come because of demand deriving from consumers.”
First Published Date: 31 Jul 2024, 06:59 AM IST