Stellantis Closes Van Factory In Russia Due To Chip Supply Short

JAKARTA - Van factory, Stellantis in Russia must be closed immediately due to running out of spare parts. The announcement came from the company's chief executive Carlos Tavares, Thursday, March 31.

The world's fourth-largest automaker earlier said it had suspended all exports and imports of vehicles with Russia. , Stellantis has been operating a van manufacturing plant in the city of Kaluga, in partnership with Mitsubishi. Production at Kaluga remains for the local market for now, following last month's Russian invasion of Ukraine.

Speaking at a news conference, Tavares did not say whether the company was considering a downgrade of Kaluga or worried it would be confiscated by Moscow if operations were stopped.

Stellantis earlier this month presented its first business plan, more than a year after it was formed through the merger of Fiat Chrysler and Peugeot maker PSA.

Tavares said the group's focus was on implementing the plan and was not looking at a major M&A deal. "We always look at what's in the market, but there's no need for an M&A, it's very clear," he said.

Supply chain

Overcoming the supply crisis that has hurt the auto industry, Tavares said Stellantis is expected to acquire computer chips from Europe and the United States within 3-4 years.

"We had to find other ways to adapt the supply chain, we had several initiatives to create local sources of semiconductors," added Tavares, head of the company whose brands include Jeep, Maserati, Citroen, and Opel.

Tavares said the technology that underpins the shift to electric mobility is not yet finalized, making it difficult for automakers to plan and secure future supplies of raw materials.

"We're moving down the supply chain, we've sealed deals to secure lithium for example, but we need to do more," he said. "What the endpoint is for battery cell chemistry is not yet clear. When the technology is somewhat certain, we will be able to lock in the supply of raw materials through investments, deals, M&A."

Tavares said automakers need to cut the cost of electric vehicles over the next 4-5 years and called on the government to help in the effort.