Stellantis Shifts U.S. Investment Away From EVs

Stellantis is funneling a $13 billion U.S. manufacturing wave into combustion powertrains and range-extended models rather than pure battery-electric vehicles, in what amounts to a pragmatic pivot in the face of stalled EV demand. The multibillion-dollar plan is built around new products, plant reopenings, and engine capacity in factories — with a common thread: flexibility versus full electrification.

A $13 Billion U.S. Manufacturing Bet on Flexibility

The automaker will produce five vehicles through 2029 in plants in Illinois, Ohio, Michigan, and Indiana and add more than 5,000 jobs. Among them is reopening the Belvidere Assembly Plant in Illinois, which will allow for increased manufacture of Jeep Cherokee and Jeep Compass vehicles for the U.S. market.

Unlike recent Detroit investment tides shaped by all-electric rollouts, Stellantis is focusing on models that can be introduced and sold profitably in multiple policy and demand states. Leadership has framed the move as a growth multiplier that further establishes the company’s U.S. manufacturing footprint and smooths out volumes in core markets.

Product Map Favors ICE And Range-Extending Configurations

Among the five vehicles, just one is a range-extended EV planned to be produced at the Warren Truck Assembly Plant in Michigan beginning in 2028. Range-extended setups are those that add driving miles outside of public charging by teaming a battery up with a gasoline generator — an approach drawing from early experiments like the Chevrolet Volt and BMW i3 REx, adapted for today’s heavier trucks and SUVs.

Warren would also manufacture a new, large gas-guzzling SUV targeted at the most lucrative patch of the U.S. market. A next-generation Dodge Durango arrives in 2029 at the Detroit Assembly Complex, and an unnamed new midsize truck will enter the Toledo Assembly Complex (Ohio). As well, Stellantis will unveil an all-new four-cylinder engine, the GMET4 EVO, in Kokomo, Indiana, in 2026 — evidence that internal-combustion investments are a crucial part of the product mix.

The move dovetails with Stellantis’ recent recalibrations in North America. The company has also put an all-electric full-size pickup on the back burner for now, nixed plans to offer an electrified Gladiator, and is prioritizing extended-range plug-in models like the Ram 1500 REV (a modern-day version of Ramcharger) as a hedge against spotty charging infrastructure and tax-credit eligibility restrictions.

Policy and demand pressures drive Stellantis pivot

U.S. electric-vehicle adoption is rising, but not as quickly as many 2021–2022 targets projected. Through July, electric cars made up about 8 percent of new vehicle sales in the United States in 2024, according to Cox Automotive — most of it clustered in a few coastal markets. Inventory figures have consistently shown that electric-vehicle days’ supply is higher than the industry average, an indication of “lumpy demand” and price sensitivity.

Regulation-wise, the Environmental Protection Agency’s finalized standards for model years 2027–2032 tighten fleet emissions but allow a mix of solutions — hybrids, plug-in hybrids, efficiency gains, and EVs — instead of simply insisting on a pure BEV route. Meanwhile, changing rules for sourcing batteries under federal tax credits have narrowed which vehicles qualify for those credits, complicating pricing strategies. These are the factors that reward automakers who can quickly shift between ICE, hybrid, and electrified powertrains as conditions change.

Analysts at S&P Global Mobility and the Alliance for Automotive Innovation have observed a growing industry trend favoring hybrids and plug-in hybrids as an interim bridge, particularly in truck and SUV segments where towing, payload, and charging limitations are more challenging. Stellantis’ emphasis on a range-extended platform and a new high-efficiency engine fits the calculus.

Jobs and plant footprint in the spotlight across Midwest

Restarting Belvidere is economically and politically important. The plant’s reopening meets the promises made in 2023 labor negotiations around returning product to idled facilities, said the United Auto Workers. Inclusion of Toledo, Detroit, Warren, and Kokomo in the investment plan would also diversify geographic risk and reinforce a Midwestern manufacturing base capable of producing multiple propulsion system types.

The Kokomo engine program highlights sustained interest in advanced ICE manufacturing while Stellantis builds separate battery partnerships in North America. In mixing new engine capacity with range-extended vehicles, the company retains options if reactions — and creditworthiness — shift in favor of plug-in hybrids and efficient gasoline models again.

Implications For The Competitive Environment

Stellantis is not the only one hitting the brakes on going all BEV at full speed. General Motors has revived plans for plug-in hybrids in North America later this decade, and Ford has bet hard on hybrid versions of its best-selling pickups like the F-150 while calibrating battery investments. For suppliers, Stellantis’ strategy would mean steadier business for engines, transmissions, and mixed-technology components along with selective electrification programs.

The risk is timing. If charging buildout speeds up and battery costs plummet, the product slate heavy in ICE and range-extended models could seem conservative by late in the decade. If policy agility and consumer pragmatism win out instead, Stellantis could find itself with fatter margins and less need for incentives as it scales BEVs at a more leisurely pace.

What to watch next as Stellantis executes its U.S. plan

Highlights include the GMET4 EVO engine introduction in 2026, range-extended model production at Warren in 2028, and next-generation Durango and midsize truck programs by 2029. Also watch for news on U.S. tax-credit eligibility, EPA compliance approaches, and dealer inventory trends from Cox Automotive. Collectively, they will reveal whether Stellantis’ big bet on flexibility is prescient — or just a short slide before the next wave of electric vehicles.