By Michael Elkins
Bloomberg reports Thursday, citing people familiar with the situation, that automaker Stellantis NV (NYSE:STLA) is “leaning” toward expanding production of its Peugeot e-208 electric vehicle in Spain despite pressure from the French government to add output in France.
Finance Minister Bruno Le Maire would like Stellantis to build the compact model locally in France and has been discussing the matter with CEO Carlos Tavares, said the people.
Stellantis currently builds the vehicle in Slovakia and is now considering an expansion of its plant in Zaragoza, northeastern Spain, where it already makes small cars including the Opel Corsa. However, a final decision hasn’t been made.
Governments across Europe are fighting for automaking jobs as the market shifts to battery power. Securing production of a mass-market vehicle like the 208 would be a big get, as it’s now Europe’s best-selling car, having ended the 14-year reign of the Volkswagen (ETR:VOWG_p) Golf in 2022.
The French government is working with Stellantis and its peers to locate assembly of as many vehicles as possible in France, a finance ministry official said, declining to elaborate.
Stellantis pledged to produce 12 EVs in France, but they’re mostly larger, higher-end models like the e-308 sedan and e-408 crossover. After French automaker Renault SA (OTC:RNLSY) said it would assemble its electric R5 compact car at home, Paris is hoping Stellantis will also build more budget vehicles in the country to help counter inflation, the people said.
Shares of STLA are up 2.01% in afternoon trading on Thursday.