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Why EVs and gas-powered cars sharing the same platform could the be the right move for automakers

Stellantis’ recent investment in shared platforms for both gas and electric pickups may help ease electrification uncertainty.

The bursting of the electric vehicle bubble in America caught automakers, analysts, and even some customers by surprise.

Though EV sales are still growing, the pace of that growth is nowhere near what automakers — some of whom pledged to go fully electric by 2030 — were expecting, especially when hundreds of billions of dollars are on the line for up-front investments in factories and developing new technologies.

While the transition is taking longer than many expected, a few automakers have hedged their bets with a shared platform that can accommodate both gas-powered and electrified powertrains, as opposed to dedicated separate platforms for each.

The Ram 1500 REV EV pickup (Credit: Stellantis)
The Ram 1500 REV EV pickup (Stellantis) (Ram)

Last week, Stellantis (STLA) announced something the industry hadn’t seen in quite some time — new investment in facilities making EVs.

Stellantis said it would invest $406 million in three Michigan facilities and confirmed that its Sterling Heights plant will be the automaker’s first US factory to build a fully electric vehicle — the Ram 1500 REV electric pickup, which is launching later this year.

However, the 1500 REV, the hybrid range-extended Ram 1500 Ramcharger, and the pure gas truck are all going to be built alongside each other at the Sterling Heights facility; in addition, the 1500 REV and the hybrid 1500 Ramcharger will actually use the same platform underneath.

Both of these electrified models are built on the “STLA Frame” architecture, which Stellantis says is specifically designed for full-size body-on-frame vehicles (like pickups) but can support fully electric, hybrid, gas-powered, and even hydrogen fuel cell powertrains. This means both the hybrid and full EVs can use a common platform. Stellantis’ other new platforms — the STLA Small, Medium, and Large — are also built to accommodate EV and gas powertrains.

“Creating a family of vehicles from a well-engineered set of components that is flexible enough to cover multiple vehicle types and propulsions, overperforming any of our current products, will address each of our iconic brands’ customers,” Stellantis CEO Carlos Tavares said earlier this year.

While many in the industry transitioned to fully dedicated EV platforms right off the bat, Stellantis and others like BMW (BMWYY) didn’t. And it might be the right call.

A Volkswagen ID.4 electric vehicle (EV) charges via a CCS DC fast charger from Electrify America at a shopping mall parking lot in Torrance, California, on February 23, 2024. (Photo by Patrick T. Fallon / AFP) (Photo by PATRICK T. FALLON/AFP via Getty Images)
A Volkswagen ID.4 electric vehicle charges via a CCS DC fast charger from Electrify America at a shopping mall parking lot in Torrance, Calif., on Feb. 23, 2024. (PATRICK T. FALLON/AFP via Getty Images) (PATRICK T. FALLON via Getty Images)

“Having the same chassis for gasoline, hybrid, and electric vehicles can be beneficial, particularly when the assembly line needs to be responsive to the electric vehicle demand volatility,” Eleftheria Kontou, assistant professor at the University of Illinois Grainger College of Engineering, told Yahoo Finance.

Kontou, an expert and researcher in electrified transportation systems, added that demand for EVs is also dependent on the policy landscape, with federal EV tax credits boosting demand, but an uneven deployment of charging infrastructure blunting EV desirability.

“There's also some uncertainty with respect to how the electric vehicle market is going, right? Consumers are a bit more uncertain nowadays, with respect to electric vehicles, so it's good to have an assembly line that can be responsive to such changes,” she said.

“It absolutely is,” added AutoForecast Solutions’ Sam Fiorani to Yahoo Finance on whether a shared or common platform is the right move. “Developing a platform that allows you to bridge the gap with a variety of powertrain choices makes more sense than developing fully electric vehicles, and that looks like what Stellantis has done with the STLA platform.”

Fiorani added that the industry is trapped in a transitional period between fully gas-powered and fully electric vehicles, and it’s going to take at least a generation of vehicles before full EV sales start to really pick up steam.

The transitional period will mean both gas-powered and electric versions of cars will be in the market at the same time, requiring automakers to build both, he said.

The BMW i7 sedan, which comes in both a fully-electric or gas-powered powertrain (credit: BMW)
The BMW i7 sedan, which comes in both a fully electric and gas-powered powertrain. (BMW) (BMW)

The drawback of using a shared platform is cost inefficiencies. While the up-front cost is likely much higher for dedicated EV and gas-powered platforms, down-the-line efficiencies of scale and simplification in manufacturing may mean dedicated EVs will be cheaper to make.

Companies like GM (GM), Mercedes (MBGYY), and Ford (F), among others, are currently going down the dedicated EV platform path, with Ford even pushing forward with an all-new smaller EV platform for use with a number of compact and midsize EVs in the future.

But Mercedes’ rival BMW is not following that path, at least for now.

BMW has been releasing vehicles — for example, the new 7 Series — in both traditional gas-powered and EV form, with both vehicles looking identical. Most other automakers' EVs appear starkly different from their gas-powered brethren, with companies basically offering different product lines.

“When I am visiting our dealerships, I am asking them, ‘Is it an advantage or a disadvantage that we are offering the same vehicles with all different [gas-powered and electric] powertrains?’” said Frank Weber, BMW’s chief technology officer and board member told Yahoo Finance at a media briefing earlier this year.

“And for us, it is really key that you find the right solution for the individual person, and I think what has helped ... [is] that we are very clear in our structure [in] that we say a 7 Series is a 7 Series, a 5 Series is a 5 Series,” Weber said.

Weber believes this structure helps customers select the car that best suits their needs. He used the example of a European customer who thinks he needs a BEV (battery electric vehicle), but ends up buying a diesel-powered car because he needs more range or lacks access to chargers.

Even Jaguar Land Rover, back in 2022, decided its largest and greatest Range Rover would need to accommodate gas, hybrid, and fully electric powertrains on the same platform.

The BMW Vision Neue Klasse X (credit BMW)
The BMW Vision Neue Klasse X. (BMW) (BMW)

“That’s why the new platform was conceived from the start, having everything from a pure V8 through to a pure battery electric — it was important for us to make sure we satisfy all those [customer] needs,” said Rob Filipovic, Jaguar Land Rover director of product planning, in an interview with Yahoo Finance.

BMW, for its part, intends to evolve its strategy as it sees the EV market maturing. Earlier this year, BMW unveiled a concept, dubbed Neue Klasse, that will closely resemble an actual model coming out in the second half of next year based on BMW’s dedicated EV platform, which would be a split from its current dual-platform strategy.

Despite this new class of EVs being on a separate platform, BMW said technology products like infotainment and electronics will still be shared across EV and gas-powered vehicles, as it keeps costs lower and maintains product consistency.

That being said, it remains to be seen whether shared platforms may become more common as the industry tries to predict what’s next.

“I am not necessarily sure about that,” Kontou said when asked whether other automakers will follow suit with shared platforms. “That depends on the decision making with respect to investing in more factories on that front, but I wouldn't rule it out, and in particular the BMW success ... can be a lesson learned for the rest of the auto manufacturers.”

Whether other automakers copy BMW, Stellantis, and others will likely depend on the success (or failure) of their competitors.

“The Ram will be the canary in the coal mine for everybody else,” Fiorani said about Stellantis’ pickup experiment in Michigan. “If it does well, expect to see a bunch of other companies following suit.”

StockStory aims to help individual investors beat the market.
StockStory aims to help individual investors beat the market.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on Twitter and on Instagram.

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