Autmotive News Europe — 2024-10-03
Automotive Industry
Production in Stellantis's factories in Italy continues to plunge, amid mounting anger from auto workers unions.
The automaker's output in Italy is set to drop below 500,000 vehicles this year from 751,000 in 2023, the FIM-CISL union said, citing persistently soft market demand, especially for electric vehicles.
The projection signals an output level well below the 2030 target for annual production of 1 million vehicles for passenger cars and vans that Stellantis is discussing with the Italian government.
Italy's metalworkers unions have called for a one day strike on 18 October to protest against the falling production.
Stellantis, which builds Alfa Romeo, Fiat and Maserati models in Italy, as well as vans for other brands, produced 237,700 cars in the first nine months, according to FIM-CISL. That is down 41% from the same period last year and even below 2020, when plants shut for months following the initial outbreak of Covid-19.
All six Stellantis factories in Italy saw output decline in the first nine months, the union said 2 October.
Stellantis is struggling with slowing and more competitive auto markets across Europe, where electric-vehicle demand is waning. Output at the Mirafiori factory in Turin — where the automaker has suspended production of its slow-selling electric Fiat 500e — fell 68% in the period.
The data reinforced fears of structural overcapacity in Europe for local automakers amid mounting pressures from Asian rivals. The region's top manufacturer, Volkswagen Group, last month announced it could close factories in Germany for the first time.
"If the trend seen in the third quarter was to be confirmed in the last quarter of the year, the production (situation) would become even more serious," with fewer than 300,000 cars and some 200,000 vans produced, said the FIM-CISL's head, Ferdinando Uliano.
Uliano, who was presenting the union's quarterly report on the automaker's output in the country, said production volumes were not helped by delays in the government's new purchase incentive scheme, which was announced at the beginning of this year but introduced only in June.
"We think that the lack of incentives in other European countries has had a negative impact," he said.
The pullback has dealt a blow to Prime Minister Giorgia Meloni, who wants to boost auto production in Italy to 1 million vehicles by the end of the decade. Stellantis CEO Carlos Tavares has clashed with Rome over EV incentives and the company's decision to move some output to lower-cost countries.
Tavares is under pressure after the group's financial results fell sharply this year, with Stellantis announcing a downgrade to its 2024 forecast. Adjusted profit margin is now expected to be between 5.5% and 7.0% for the year, down from the double digit level previously forecast, the automaker said on Sept. 30.
Tavares is due to address an Italian parliamentary committee at the end of next week about the country’s outlook for automotive production.
Stellantis said in a statement that the automotive market faced a complicated situation which, in Italy in particular, was made worse by elements including high energy and labor costs. A broad rethinking of the country's industrial policies was key to achieving proposed results, the company said.
Bloomberg and Reuters contributed to this report.