Marchionne Claims $10,000 Loss On Each Fiat 500e
Despite overwhelmingly positive press for the Fiat 500e, the electric Fiat is known to be a bete-noir for Fiat CEO Sergio Marchionne. Speaking at the SAE Congress last week, Marchionne claimed that Fiat loses $10,000 on each 500e, describing it as “masochism”.
Marchionne has repeatedly stated that Fiat is only building the car to comply with California regulations that mandate the sale of zero-emissions vehicles. But despite rave reviews and an aggressive lease program, Marchionne has repeatedly made negative statements about the car. The Detroit Free Press quotes Marchionne on the nature of the money losing EV
“For every 500 electric that we produce even after all the subsidies we will lose about $10,000 bucks a car,” Marchionne said. “Doing that on a large scale would be masochism to the extreme.”
Machionne also urged governments to stay “neutral” on what technologies it decides to subsidize, citing the current trendiness of EVs versus the widespread enthusiasm for hydrogen a decade ago.
“A number of governments around the world including the U.S. have provided incentives for consumers to purchase plug-in electric vehicles and have provided direct incentives to manufacturers…my fear is that regulators are rushing precipitously into embracing electric vehicles as the only technological solution.”
Doing some quick guestimating compared to the Abarth, that means he's saying it costs them $18,000 - $20,000 more to produce the 500e than the Abarth. That seems like a bit of an exaggeration to me.
If Fiat is losing so much money on each electric tin can they sell or lease, then they might as well take up an offer one used to see years ago on the back cover of comic books and sell seeds door-to-door... See if that works better. Seriously, though, the industry is still researching the technology, and it's going to take more years to make a significant breakthrough that makes an all-electric vehicle palpable for the general market, where people who would normally buy only gasoline-engine cars like me would feel comfortable with this technology. I'd still like a Volt, though.
Isn't one option to pay the fines for not meeting CAFE? It's something like $55 per MPG, right? The Germans have been doing this for years, as have some others. Is that more expensive than subsidizing a few EVs for Chrysler? http://www.nhtsa.gov/cars/rules/cafe/FINES-COLLECTED-SUMMARY.html
Theyre all in the same boat. Some manufacturers saw the value in doing research and investing in new technology. Its called innovation, and Toyota did it well. Fiat got up late for school, forgot they had a term project due, slapped something together and now theyre complaining about it.