THE BOSS of an iconic car brand has revealed a major update on its merger with a rival, as the company admits the EV push is hurting sales.

Despite rumours of a potential tie-up between Stellantis and Renault, both companies have denied seeking a partnership.

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John Elkann, Stellantis Chairman, told the Financial Times: “We are not discussing any merger.”

Management at the automotive giant has been turbulent following the resignation of the former CEO, Carlos Tavares, who they still haven’t replaced.

The automotive giant currently oversees many carmakers such as Peugeot, Fiat and Vauxhall.

However, Stellantis has several underperforming brands, such as Chrysler, described as “a shadow of its former self,” according to motor1.com

Another failing car manufacturer is Abarth, which has seen revenues drop during its push to go fully electric.

This has caused major concern at Stellantis, adding to the company’s decision not to get involved in a massive merger.

Last year, the Auto conglomerate recorded a 12 per cent drop in shipments, which they blamed on “temporary gaps in product offerings”.

On the other hand, the Renault group reported their highest sales.

The two major companies share a common ground regarding the future of cars in Europe.

Both share concerns over strict emission regulations negatively impacting their profit and production of gas-powered city cars.

The European Union recently granted automakers an extension to meet their emission targets.

However, by 2030, stricter regulations will come into force, banning the sale of new cars with harmful emissions across the EU.

This comes after Europe’s second-largest carmaker halted production of an iconic model as its EV lineup faces “deep trouble”.

An initial manufacturing break at Stellantis has now been extended as bosses report a collapse in demand for electric cars.

The Fiat 500 was one of the vast company’s most successful and beloved models across two production runs lasting a collective 35 years.

Dating back to 1957, it has sold more than six million units between its two iterations.

However, the 500e, unveiled in 2020 as an electric alternative, has proved less popular.

The model is intended as the long-term successor to the 500 beyond the 2035 ban on petrol and diesel car sales.

But stuttering demand has now forced a pause in its production.

The latest data suggest that both the petrol and electric 500 sol 74,885 units from January to July.

That’s almost a quarter down on the same period last year.

Bosses told Autocar that poor sales were “linked to the deep difficulties experienced in the European EV market by all producers.”

They have also reportedly told union reps that the electric car segment is facing “deep trouble” more generally.

Fiat CEO Olivier François said: “We obviously, like everyone else, thought that the world would go electric faster and the cost of electrification would go down faster.

“But we couldn’t imagine that Covid would happen, shortage of raw materials would happen [and] the European Society – not all, not the youngest part – would turn their backs on the sustainable solutions.

“But this is the reality. We have to face those realities.”