Former Chrysler and Home Depot CEO Bob Nardelli on consumer expectations clashing with EV market results and the state of the U.S. economy.
With electric vehicle (EV) names like Tesla and Rivian recently announcing financial woes, the former CEO and Chairman of Chrysler told a cautionary tale about the market’s future.
“They’re having one heck of a time. These startups are just not going to make it,” Bob Nardelli, who was at the helm of Chrysler during the Great Recession, said on “Cavuto: Coast to Coast,” Tuesday.
“This is just another issue, another debacle by this administration trying to create a revolution versus allowing an evolution,” he continued. “You can’t force it down consumers’ throats.”
On the same day as Nardelli’s comments, Tesla stock started to slide on a big deliveries shortfall: the EV maker produced over 433,000 vehicles during the first three months of the year, down 12% from the prior quarter, and it delivered 387,000, down 20% from the prior quarter, the company reported. Analysts had expected the automaker to deliver over 400,000, according to estimates.
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The latest snapshot is another headwind for shareholders, with Tesla’s stock down over 30% so far this year.
Former Chrysler Chairman and CEO Bob Nardelli predicted EV companies are “not going to make it” on “Cavuto: Coast to Coast.” (Getty Images/iStock)
Just last month, Rivian announced it would lay off 10% of its salaried employees while projecting vehicle output to be flat. The company expects to produce the same number, about 57,000 vehicles, in 2024 as it did the year before, the company said in a regulatory filing.
President Biden’s policies that push towards a zero-emissions, EV-only auto market parallel regulations Nardelli allegedly saw as Chrysler CEO during the Obama-Biden administration.
“They basically said the average mileage for an internal combustion engine had to increase significantly, therefore limiting the number of Ram trucks I could produce. So we had to produce smaller cars. The consumer said ‘no thanks,’ and they had to find an off-ramp then,” Nardelli explained.
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“When I was at Chrysler, the average [car] age was 11 years. It’s now grown to 12.6 years,” he added. “Consumers are still saying, ‘I’ll make the decision on what I want to buy. [This] administration, yet another debacle with EVs, you’re not going to force me to do that.’”
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U.S. consumers’ interest in electric vehicles has lost charge, according to a recent survey that found 41% of respondents said they were interested in buying or leasing an EV as their next vehicle, down from 49% from a year earlier.
That same survey indicated when respondents were asked to choose between two hypothetical identical vehicles with the same price tag – a hybrid that does not require charging and an EV that does – 83% chose the hybrid. The most frequently cited reason (66%) was the option to use gas, followed by limited EV driving range (57%) and the inconvenience of charging EVs (52%).
FOX Business’ Daniella Genovese and Breck Dumas contributed to this report.
