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Stellantis Makes Historic ICE Investment In South America

For all the talk of this being the end of the internal combustion engine (ICE) era, automakers are still spending billions of dollars on making new ICEs. For example, automotive juggernaut Stellantis, the parent company to brands such as Jeep, Dodge, and Chrysler, is spending $6 billion on ICE development in South America alone, according to a report from Motor1.

A Historic Investment

According to the report from Motor1, Stellantis’ $6 billion play is the most significant investment in the history of South America’s automotive industry. It’s an investment that will lead to the development and launch of more than 40 vehicles, along with flex-fuel engines, which are ICEs capable of running on gasoline and ethanol.

Their report claims that the automaker’s plan includes plug-in and hybrid-flex automobiles that will increase efficiency by marrying their versatile ICEs with a battery. Motor1 also states that Stellantis will manufacture at least one electric vehicle (EV) in South America. Their investments will happen between next year and the end of the decade.

It’s A Savvy Move For Stellantis

The South American market provides Stellantis with significant business, with the company having a 31.4 percent market share in Brazil and a 23.5 percent market share through the rest of the South American region. They also have a 28.6 percent market share in South America for commercial vehicle sales, according to Motor1.

Additionally, Motor1 reports that Stellatni’s electrified flex-fuel engines will be compatible with various models across the automaker’s lineup, allowing them to keep their South American production costs low. Some of these new flex-fuel hybrid models will launch later this year.

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Similarly, Toyota is betting on a future where the industry offers more than just EVs. The Japanese automotive icon, also 2023’s most successful automaker, took last year’s sales crown while selling a tiny amount of EVs. Much of Toyota’s success comes from its excellent hybrid cars.

The opportunity that this move gives Stellatnis for growth in a market where they are already successful points to a statement Toyota’s Chairman made a few months ago when he predicted that EVs would not account for more than 30 percent of the car market. Given Toyota’s success with hybrid vehicles and Stellantis’ move to introduce many new ICE vehicles to the South American market in the coming years, the Chairman was onto something with his prediction.

Author: Jarret Hendrickson

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