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Stellantis plans to launch a new small, low-cost category of fully electric vehicles in an effort to revive Europe’s shrinking entry-level car segment and ailing manufacturing sector.
The Fiat, Opel and Citroen owner said production of the affordable, compact and fully electric “E-Car” will start in 2028 at its Pomigliano d’Arco plant in Italy, with potential for “significant” volumes.
It’s believed they will come with a price tag of around 15,000 euros ($24,000 US).
Automakers have neglected low-cost, entry-level models in recent years due to rising costs linked to electrification and safety regulations, as well as a search for higher margins which has driven them towards mid-sized and larger cars.
E-Car to draw on partnerships
The E-Car will draw on partnerships to keep costs down and speed up development, and will help support local manufacturing jobs, Stellantis said in a statement on Tuesday.
CEO Antonio Filosa, who is due to present a new business plan on Thursday, said it aimed to tap into demand for “small, stylish vehicles” made in Europe for the European market, adding the E-Car would come in “new models for multiple brands.”
Stellantis has argued that Europe, where safety and emissions rules have significantly added to the cost of new cars, needed a new generation of stripped-down, cost-efficient small vehicles, in the style of Japan’s “kei cars.”
Japan kei cars a model for E-Cars
Kei cars are urban vehicles traditionally sold in Japan with size and engine restrictions, enjoying lower tax and insurance costs. They cover a significant portion of the local market.
The European Commission has recognized the new E-Car segment for its potential to boost European design and manufacturing jobs and support a wider EV adoption, especially for everyday city mobility, Stellantis said on Tuesday.
Stellantis has warned that without more affordable EVs, the EU’s push towards zero-emission mobility risks stalling, particularly among lower-income consumers.
Safety features in the EU, such as sensors detecting whether a driver is falling asleep or an SOS button, are required on cars from the smallest ones up to larger SUVs, with a larger impact on the cost of cars used mainly for short city journeys.
Addressing Europe’s low capacity utilization
With expected high volumes, the E-Car should help Stellantis improve its underused production capacity in Europe, a goal Filosa is also pursuing by expanding cooperation with Chinese partner Leapmotor.
The two automakers announced earlier this month the joint production of two models in Spain, while Stellantis suggested manufacturing cooperation with Dongfeng could expand beyond China.
The Pomigliano plant manufactures models including the Fiat Panda, which is set to remain in production at least until 2030.
Italian unions welcomed the announcement and said in a statement the new production should eventually allow the plant to reach full employment. They also confirmed the E-Car price.