Tavares shares views on bid to combine PSA and Fiat Chrysler
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PSA does not have a designated chief operating officer. How do you manage decision-making?
I am a strong believer in a matrix organization. At PSA we operate within three axes: the regions, the brands and the functions. Even within this three-dimensional operation, we have business units that go through and try to boost the system. For example, we could have the CEO of Peugeot reporting on volumes and profit, then the European head report on total profits, volumes, market share, quality and customer satisfaction for all brands in the region. On the functional side, we would look at whether we are ready to launch a new car, are manufacturing costs being reduced? So we are constantly reviewing the business in three dimensions.
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On Jan. 1 new EU CO2 regulations will start to take effect and fleet emissions will have to drop sharply to 95 grams per kilometer. How will PSA flip that switch?
We have a very precise process. I can't say a lot about it because it's highly competitive, but it involves our production, our order book, and making our dealers actors in what we are doing, not just followers. For us, it's an ethical matter [to meet CO2 targets], not just a financial matter. Our employees' children might ask them someday, "What did you do to fix the global warming issue?" So, they want to say that despite working at a car company, they are contributing -- and working really hard -- to address global warming.
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PSA has had some of the best operating margins in the automotive industry, but there is an overall cost for emissions compliance. How much of this cost can you absorb and how much will you pass on to your customers?
We can be very disciplined on pricing, but at the end of the day it doesn't matter. All we can do is be the most profitable, so you don't get hit immediately by the costs of governments not investing in a charging network, not subsidizing sales of electric vehicles appropriately, or doing the wrong thing in terms of regulations. So either we digest these costs, or we are able to increase productivity. Or we can't, and somebody will get hurt.
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Whole interview at:
Tavares shares views on bid to combine PSA and Fiat Chrysler (at https://europe.autonews.com/automakers/tavares-shares-views-bid-combine-psa-and-fiat-chrysler )
