The “spaghetti west” of Stellantis in Italy continues against the backdrop of Chinese producers

The “spaghetti west” of Stellantis in Italy continues against the backdrop of Chinese producers

The merger between Fiat-Chrysler and PSA is entering new turbulent territory. The Italian government was counting on the Franco-Italian-American group to produce one million cars a year (compared to the 630,000 expected this year by the unions). A goal that today contradicts the reality of the market.

Following the decline in sales in the first quarter, the manufacturer recorded a 10% drop in productionnot 51% for the Fiat factory in Mirafiori only, near Turin. The site mainly collects Fiat 500e directly affected by the decline in European demand for BEVs.

The Italian situation in implementing an aid program for the electric vehicle sector had already prompted a friendly exchange between the manufacturer and its political leaders this winter. Carlos Tavares, CEO of Stellantis, criticized Italy at the time for spending « much less money than any other major European country to support electric cars ».

65,000 employees and 12 production sites

Italian brand, Fiat employs 65,000 peoplefigure that does the first private employer on the peninsula. The manufacturer has several sites (including factories dedicated to engine production), including four assembly plants including the historic Mirafiori site (Fiat 500 and Maserati Levante).

The group also has assembly lines in Cassino (dedicated to Alfa Romeo), in Pomigliano d’Arco, near Naples (for Fiat Panda) and in Melfi in the south of the country (mainly for Jeep and Fiat 500X). Remember that the revitalization of Fiat factories is one of the challenges taken by Carlos Tavares.

The latest announcement from Stellantis was meant to be encouraging. Melfi was to welcome five new models, while the development program was presented to Mirafiori. The Pomigliano plant saw production of the hot Panda extended to 2030. In Cassino new STLA BEV platforms.

Big threat to Fiat in Italy

The decision of the Italian government to attack Fiat’s monopoly in the production of cars, with the aim of welcoming a foreign manufacturer, is therefore not to the taste of Carlos Tavares. Besides that Tesladiscussion initiated by Prime Minister Giorgia Meloni, involved Chery Auto and BYD. Chinese car production in Italy can « forcing Stellantis to make difficult decisions, including closing the factory »warns Carlos Tavares. “If anyone wants to start a Chinese competition, they will be responsible for any unpleasant decisions that may be made. » The manager stressed that Stellantis could lose market share and sales volume.

With a market share of 11.14%, Fiat remains the leader in Italy. But the manufacturer is struggling to face competition led by Volkswagen and Toyota, as electric cars represent less than 4% of sales at the market level. Last year, the brand’s sales volume fell below 175,000 units, the first since 1960. For Fiat, which is already planning a “voluntary departure” of 3,700, the arrival of a Chinese competitor and aggressive positioning will undoubtedly be a very serious additional threat.