Fiat will lose $10,000 for every 500e sold

Article by Christian Andrei, on April 24, 2013

Fiat CEO Sergio Marchionne claims that for every 500e sold, the company loses $10,000 even after all the subsidies. Marchionne disclosed this at his recent speech in Detroit at the Society of Automotive Engineers World Congress. Marchionne had said that to comply with fuel economy regulations, automakers have to concentrate on several alternative fuel technologies.

He said losing this much on a big scale will be “masochism to the extreme.” At the present, new car fleets have to average 28 to 30 mpg. By 2016, cars have to meet an average rating of 35.5 mpg and by 2025, this goes up to 54.5 mpg. Automakers are able to earn government credits when they offer alternative-fuel vehicles like hybrids, plug-in hybrids, and EVs.

However, Marchionne is anxious about the possibility that government incentives for electric vehicles will be considered to be the best alternative-powertrain method. He is urging for “technological neutral” regulation. Initially, the Fiat 500e will be sold in California. It has a starting price of $32,500 before government incentives like $7500 federal tax credits and those given by California and local governments.

The Fiat 500e has an EPA rating of 122/108 mpge city/highway and comes with a range of 87 miles. It has an output of 111-hp and 134-lb-ft of torque. Meanwhile, the bigger Ford Focus EV has an EPA rating of 110/95 mpg and has a range of 76 miles. Chrysler has made more fuel-economy improvements with the eight-speed automatic in models like the Ram 1500, Chrysler 300, and Dodge Charger. The 2014 Jeep Cherokee will soon get a nine-speed automatic.

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