Fiat Chrysler Automobiles Chief Executive Sergio Marchionne has a request for potential buyers of the automaker's Fiat 500e electric car: Don't buy it. He's tired of losing money.
Speaking at a conference in Washington on Wednesday, Marchionne said Tesla Motors Inc was the only company making money on electric cars and that was because of the higher price point for its Model S sedan. Decrying the federal and state mandates that push manufacturers to build electric cars, Marchionne said he hoped to sell the minimum number of 500e cars possible.
Continue Reading Below
"I hope you don't buy it because every time I sell one it costs me $14,000," he said to the audience at the Brookings Institution about the 500e. "I'm honest enough to tell you that."
The gasoline-powered Fiat 500 starts at almost $17,300 including delivery charges, while the 500e starts at $32,650 before federal tax credits. Consumers are not willing to pay a price that covers Fiat's costs so it loses money on the 500e.
Through April, the automaker sold 11,514 of the 500 cars in the United States this year, down about 15 percent from the same period last year. The company does not break out 500e sales.
"I will sell the (minimum) of what I need to sell and not one more," Marchionne said of the 500e.
Chrysler filed for bankruptcy in 2009 and received a U.S taxpayer-funded bailout. Italy's Fiat took over the U.S. automaker at the time and completed the buyout earlier this year.
"If we just build those vehicles, we'll be back asking ... in Washington for a second bailout because we'll be bankrupt," Marchionne said of electric cars.
The state of California's zero-emission vehicle mandates and federal fuel efficiency requirements for 2025 were pushing the need for electric cars, but Marchionne said he would prefer the U.S. Department of Energy simply set targets and let the automakers achieve them in their own way.
Marchionne said for the company in 2025 to maintain the same type of U.S. sales mix it has now, hybrid vehicles that are powered by both gasoline and electric engines will make up more than half if not close to three-quarters of sales.
Electric car sales have been held back by inadequate driving range in the eyes of many consumers and high sticker prices.
(Additional reporting by Ben Klayman in Detroit; Editing by Cynthia Osterman)