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    Stellantis Quietly Brought Back Diesels Because They Are Getting Crushed by China

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    Stellantis announced in March 2022 that battery electric vehicles would represent 100 percent of European sales by 2030. Three years later, the company is quietly reintroducing diesel engines across at least seven European models, according to Reuters investigation confirmed by dealer websites and company statements.The shift began in late 2025 without fanfare or press releases. Peugeot 308 family cars, DS 4 premium hatchbacks, Opel Combo vans, Peugeot Rifter SUVs, Citroën Berlingo passenger vans, and Fiat Qubo L small vans are all receiving diesel options again. The Opel Zafira, Peugeot Traveller, and Citroën SpaceTourer minivans received a new 2.2 liter diesel engine in February 2026, per Motor1, Carscoops, and Autoblog reporting.Stellantis confirmed the reversal when contacted by Reuters. "We have decided to keep diesel engines in our product portfolio and in some cases to increase our powertrain offer," a company spokesperson said. "At Stellantis we want to generate growth, that's why we are focused on customer demand."The company will also continue producing diesel powered Alfa Romeo Giulia, Stelvio, and Tonale models plus the DS 7 SUV "in response to sustained customer demand," according to official statements.Customer demand is a convenient explanation. The actual story involves Chinese competition, catastrophic EV losses, and regulatory retreat creating space for technologies Europe was supposed to abandon.The Numbers Tell A Different StoryDiesel vehicles represented just 7.7 percent of new European car sales in 2025, down from over 50 percent in 2015, according to ACEA data. Full electric vehicles captured 19.5 percent market share. Hybrids dominated at 34.5 percent. Petrol only models took 26.6 percent.Diesel is dying. Stellantis knows this. They're betting on it anyway.The strategy makes sense when you examine who's winning the European EV battle. Chinese automakers doubled their European market share to over six percent in 2025 compared to the previous year, per Electrive and Yahoo Autos. They achieved that growth by offering battery electric and plug in hybrid vehicles at price parity with conventional cars, enabled by Chinese state subsidies for battery technology and manufacturing.Stellantis cannot compete on price in the EV segment. Chinese brands undercut them consistently. BYD, Geely, and others deliver electric vehicles for thousands less than European equivalents while maintaining similar specifications.But Chinese manufacturers don't do diesel. That leaves a small but profitable niche where European brands face no competition from the companies eating their lunch everywhere else.Chris Knapman, CarGurus UK editorial director, explained the logic to Reuters. "If you're a European brand looking to differentiate yourself, diesel is an area where you could have a competitive advantage over those newer brands."Diesels also cost substantially less than EVs, creating price competition advantages at a time when consumers resist paying premiums for electric powertrains that don't meet their needs.The $26 Billion Admission Of DefeatOn February 6, 2026, Stellantis announced it was taking $26 billion in charges to unwind much of its EV strategy, according to the company's official press release. That figure approaches the total amount the company pledged to invest in electrification back at EV Day in July 2021.CEO Antonio Filosa acknowledged what anyone paying attention already knew. "The charges announced today largely reflect the cost of overestimating the pace of the energy transition that distanced us from many car buyers' real world needs, means, and desires," he stated.Translation: we bet the farm on EVs nobody wants to buy, and now we're writing off tens of billions to reverse course.The company recorded a net loss for full year 2025 and suspended its annual dividend in 2026. Stellantis stock lost roughly two thirds of its value since EV Day 2021. Automotive coverage from sites like GaukMotorBuzz.com has tracked the strategic unraveling as Stellantis abandoned electrification commitments while competitors surged ahead.The diesel resurrection started quietly in late 2025, months before the February writedown announcement. Company leadership knew the EV strategy failed long before they told shareholders.What Changed In EuropeThe European Union weakened its 2035 combustion engine phase out in December 2025, allowing 10 percent of new vehicle sales to retain internal combustion powertrains beyond the deadline. That regulatory retreat gave automakers breathing room to continue diesel production longer than previously expected.Government purchase incentives for electric vehicles evaporated across multiple European countries. Buyers who might have chosen EVs with subsidies balked at paying full price. Demand collapsed. Inventories of unsold electric vehicles piled up at dealerships.Charging infrastructure remains inadequate despite years of promised investment. Range anxiety persists as a legitimate concern for buyers whose daily driving patterns exceed EV capabilities or who lack home charging access.European electricity prices spiked following energy market disruptions. The cost advantage of charging versus fueling diesel narrowed or disappeared in some markets. Running costs became comparable while diesel retained refueling speed and infrastructure availability advantages.All of those factors created conditions where diesel suddenly looked viable again despite a decade of Dieselgate scandal fallout and environmental pressure to eliminate the technology entirely.The American Retreat Mirrors EuropeStellantis applied identical strategy in the United States after Trump administration policies dismantled federal EV incentives and emissions regulations. The company killed the planned Ram 1500 BEV before it reached production. Chrysler and Jeep plug in hybrids were discontinued. The Hemi V8 returned to the Ram 1500 lineup.Popular combustion engine models like the Jeep Cherokee crossover SUV came back from the dead. The Fiat 500 received a petrol hybrid variant alongside the electric version, hedging against continued EV demand weakness.Stellantis lost 46 percent of its annual profit in 2025. Revenue from vehicle sales fell 11 percent year over year. North American wholesale sales plunged 64.4 percent. The EV transition they promised investors destroyed shareholder value instead of creating it.Regional teams were re empowered to make decisions based on direct customer knowledge rather than following centralized electrification mandates. That organizational change enabled the diesel revival in Europe and combustion engine returns in America.The Technology Nobody Wanted To Admit Still WorksThe Opel Zafira's new 2.2 liter diesel produces 177 horsepower and 295 lb ft of torque. Zero to 62 mph happens in 10.6 seconds. Top speed reaches 115 mph. Fuel economy beats any comparable petrol engine and matches many hybrids on long distance highway driving.The engine features new generation direct injection technology and optimized exhaust gas recirculation systems. It's not 1990s diesel technology. It's modern, efficient, and meets current emissions standards despite environmental groups insisting diesel should be banned.Diesel still makes sense for buyers who drive long distances, tow trailers, or need range without frequent refueling stops. Commercial van operators prioritize uptime over environmental optics. A diesel van runs all day on a single tank. An electric van requires multiple charging stops that cost productive hours.Many European buyers purchasing vehicles in 2026 will keep them for ten to fifteen years. Betting on EV charging infrastructure improving dramatically over that timespan is optimistic given how slowly it's developed so far. Diesel infrastructure already exists everywhere.What The Press Release Didn't SayStellantis didn't announce the diesel revival. They confirmed it after Reuters confronted them with evidence from dealer configurators and company statements. The shift happened quietly, without the fanfare that accompanied EV Day promises.German Opel configurators now display diesel options for the Astra and other models. French Peugeot dealer websites list diesel engines alongside petrol and electric alternatives. Italian Fiat sites offer diesel Tipo family cars.None of those listings appeared six months ago. Someone made the decision to bring diesel back, implemented it across multiple brands and countries, and hoped nobody would notice the contradiction with previous electrification commitments.Stellantis sales fell 6.0 percent in Europe during 2025. The company maintained second place among major European automakers with 16 percent market share including both passenger cars and light commercial vehicles. But maintaining position while losing volume isn't success. It's managed decline.The diesel strategy addresses a narrow segment where Chinese competition doesn't exist yet. But it won't reverse Stellantis's fortunes. Diesel represented 8.9 percent of European sales in 2025. Even if Stellantis captured that entire segment, which they won't, it couldn't offset losses in the 75 percent of the market dominated by hybrids, petrol, and EVs.The Future Stellantis Promised Versus The One They're BuildingIn March 2022, Stellantis unveiled its Dare Forward 2030 strategic plan targeting 100 percent EV sales in Europe by decade's end. They abandoned that goal in 2025.The company promised to lead the electric vehicle transition. Instead, they're reintroducing diesel engines while Chinese manufacturers dominate European EV sales growth.Stellantis will present its new strategic plan at an investor day on May 21, 2026. Expect diesel to feature prominently despite the technology representing less than 10 percent of European sales and declining annually.The irony is thick. Four years ago, Stellantis executives stood on stage promising an electric future. Today, they're quietly reintroducing the powertrain Europe was supposed to phase out because the electric future they promised never arrived and Chinese competitors are eating their market share.Meanwhile, diesel vehicles continue meeting emissions standards, delivering range and refueling speed EVs can't match, and costing thousands less than electric equivalents. The technology works for buyers who need it.Stellantis called it customer demand. More accurately, it's strategic retreat disguised as customer service. The company overestimated EV adoption, underestimated Chinese competition, and now needs diesel sales to slow the bleeding while they figure out what comes next.The diesel revival won't save Stellantis. But it might buy time. And when you've lost two thirds of your stock value and written off $26 billion in failed EV investments, buying time is the best available strategy. Welcome back, diesel. Europe thought you were finished. Turns out the reports of your death were greatly exaggerated.
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