PARIS — The EU’s current emissions targets have been in place for just over two months, but PSA Group is already preparing for the next round of CO2 cuts, in 2025, by vertically integrating production of the electric drivetrain and planning a shift to a dedicated EV architecture.
“Our clear manufacturing strategy is to be in control of our electrified powertrains,” CEO Carlos Tavares told investors during PSA’s annual results presentation in late February.
Bringing EV powertrain production in-house makes sense for a number of reasons, Tavares and other PSA executives say, but the main goal is to protect profit margins. The move would also ensure a reliable supply of battery cells — an issue that has reportedly hobbled some EV production in Europe — and minimize disruptions from global events such as the coronavirus epidemic.
Adding electric motors and other components such as reduction gears could also help minimize one of the drawbacks anticipated in the switch to electrification from internal combustion — job losses, which are predicted to be in the tens of thousands in Europe.
PSA’s current electric and electrified vehicles use motors from Continental and Valeo-Siemens as well as battery cells from the Chinese company CATL and LG Chem of South Korea. Smaller cars are built on PSA's CMP architecture, which was developed with Chinese joint venture partner Dongfeng Motor to accommodate gasoline, diesel or full-electric powertrains. Larger cars are on the EMP2 architecture, which can accommodate plug-in hybrid drivetrains.
But that will change starting in 2022, when the first electric motors from a joint venture with the Japanese supplier Nidec will be built in PSA’s plant in Tremery, France. PSA is finalizing another joint venture, with Punch Powertrain, to build electrified drivetrain transmissions in eastern France. And in 2023, the first battery cells built with partner Total-Saft will start rolling off lines in France and Germany, supplying not only PSA’s current brand lineup but also Fiat Chrysler Automobiles brands, if the merger of the two groups goes ahead as planned.