The death of the internal combustion engine has been exaggerated since some of the largest automakers are still pouring billions into new ICEs. Stellantis is the next auto juggernaut to signal it has no intention of abandoning piston-powered cars anytime soon. The automotive conglomerate that owns 14 brands is spending the equivalent of $6 billion in South America on new engines and vehicles.
Touted as being the largest investment ever in South America's automotive sector, the expenditure will support the launch of over 40 cars and the development of flex-fuel engines. In case you're unfamiliar with the term, it refers to an internal combustion engine engineered to run on gasoline and ethanol.
Stellantis is also planning vehicles with hybrid-flex and plug-in hybrid-flex setups for even better efficiency by combining the versatile combustion engine with a battery. In addition, it'll produce at least one fully electric car in the region. The investments will be made between 2025 and 2030.
These electrified flex-fuel engines are being developed to accommodate multiple models across Stellantis' extensive portfolio. Moreover, all will be compatible with existing production lines in South America to keep costs low. New flex-fuel hybrid models are due to come out in late 2024, and some vehicles are getting a dual-clutch automatic transmission.
The region represents huge business for the automotive conglomerate considering Stellantis has a market share of 31.4 percent in Brazil and 23.5 percent across the entirety of South America. It also tops the sales charts in Argentina and Chile. Last year, Stellantis moved more than 878,000 vehicles in the region. It's also the leader in the commercial vehicle segment, with a share of 28.6 percent.
The main reason why Fiat was Stellantis' best-selling brand in 2023, for the third year in a row, was because of its excellent performance in South America. The Italian automaker is a shadow of its former self at home in Europe and nearly absent in North America but it's doing big business in many Latin American countries.
Toyota has also expressed its long-term commitment to combustion engines by announcing development has started on a new family of ICEs. While emissions regulations are not as harsh in South America as they are in Europe, the EU's ban on new cars that have harmful emissions from 2035 might be pushed back. Porsche Chief Financial Officer Lutz Meschke said so at the beginning of the year in an interview with Automotive News Europe.
