Legacy automaker Stellantis (STLA) announced on Wednesday that it will prioritize the launch of a new hybrid version of its popular Ram 1500 pickup truck ahead of the fully electric version. This is in response to the slowing demand for electric vehicles (EVs) and an “overwhelming” customer interest in hybrids.
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Indeed, EV adoption has been slowing down due to high interest rates, insufficient charging infrastructure, and questionable performance in harsh winter conditions. This has led many automakers to focus on hybrid options in order to bridge the gap. As a result, the Ram 1500 Ramcharger will open for orders in the first half of 2025, while the electric model has been pushed back to 2026, a year later than originally planned.
The global auto market is also preparing for potential policy changes under U.S. President-elect Donald Trump, which could scale back EV incentives – a move that is actually supported by EV giant Tesla (TSLA). Therefore, hybrids are becoming a safer bet for automakers trying to meet customer needs for more fuel-efficient vehicles that are greener while waiting for the uncertainty around the future of electric vehicles to become clear.
Is STLA a Good Stock to Buy Now?
Turning to Wall Street, STLA stock has a Moderate Buy consensus rating based on seven Buys, 10 Holds, and two Sells assigned in the last three months. At $14.88 per share, the average Stellantis price target implies an upside potential of 11.5%. It is also worth noting that shares of the company have declined 40% year-to-date.
