Stellantis plans to roll out electric vehicles in Europe with cheaper lithium iron phosphate (LFP) batteries.
European automakers are currently using the more power dense, but costlier, NMC cell chemistry (nickel, manganese and cobalt). However they facing increasing cost competition from rivals using Chinese-sourced LFP batteries.
“We need LFP and we will have LFP because it’s a cost competitive position to make affordable cars for the middle classes,” Stellantis CEO Carlos Tavares said on an earnings call on Wednesday.
Tavares did not give a timeframe for when the batteries will appear in EVs sold by Stellantis brands, which include Peugeot, Citroen, Opel and Fiat.
He said the “only question” is where the batteries would be sourced, either from Europe or from elsewhere.
The first plant, in Douvrin, France, will start building prototypes in the second half of this year with full production starting in 2024, Tavares said on the call.
LFP is seen as giving a useful cost advantage in a period of high battery material prices because of its lack of costly nickel, cobalt and manganese.
Tesla uses LFP batteries bought from Chinese specialist CATL for its standard range Model 3 sedan and Model Y sedan, both of which were subject to price cuts of up to 15 percent at the beginning of the year.