Chip crunch easing could weigh on pricing power, Tavares says

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FILE PHOTO: Stellantis unveils Peugeot 408 in Paris

MILAN – A slow but steady improvement in the chip supply situation over the next year will eventually limit automakers’ pricing power that has been boosting earnings across the industry in recent quarters, Stellantis CEO Carlos Tavares said on Thursday.

In a media call presenting the automaker’s results in the first half of the year, Tavares said the industry was in a “very specific sweet spot right now”.

“We have a significant unbalance between the offer and the demand of automobiles, which gives us a transaction price opportunity,” he said.

Tavares said the chip supply situation would improve slowly but would not get back to pre-COVID levels before the end of next year.

(Reporting by Giulio Piovaccari; editing by Agnieszka Flak)