MILAN – The Italian arm of global automotive giant Stellantis (STLAM.MI) experienced a significant downturn in production during 2024, with vehicle output plummeting by 37%. The steep decline, particularly in car manufacturing, has raised concerns over the future of the company’s operations in Italy and the broader challenges faced by the European automotive industry.
According to union figures released on Friday, Stellantis produced just 475,090 vehicles in Italy last year, a sharp drop from the 751,384 vehicles manufactured in 2023. The data paints a concerning picture for the company, particularly in the wake of the merger between Fiat Chrysler and PSA-Peugeot in 2021, which formed Stellantis. The fall in production is part of a wider trend affecting European carmakers, as Stellantis battles weak consumer demand, rising competition from China, regulatory pressures, and internal challenges.
The most significant blow to production came from passenger car manufacturing, which saw a staggering 46% decrease, bringing output to its lowest level since 1956. Production of new commercial vehicles also fell by 17%. These figures highlight the difficulties Stellantis faces as it struggles with the transition to electric vehicles (EVs) amid shifting consumer preferences, economic pressures, and uncertain regulatory environments. The company operates five car plants in Italy, alongside a separate facility dedicated to commercial vehicle production.
The Impact on Stellantis’ Italian Operations
The Mirafiori plant in Turin, one of Stellantis’ key production facilities in Italy, saw its output shrink by a dramatic 70% in 2024, reflecting the broader struggles within the company’s Italian operations. This is particularly troubling given that the plant has historically been one of the most iconic and productive in the country. However, the Maserati plant in Modena, located in Italy’s renowned Motor Valley, experienced the sharpest decline, with production falling by 79%.
The sharp downturn in Maserati’s output has raised alarms, with union leaders expressing deep concern about the future of the luxury brand. Ferdinando Uliano, leader of the FIM-CISL union, highlighted the urgency of addressing the crisis. “We are very worried about Maserati,” Uliano said, underscoring the importance of a clear and detailed roadmap for the brand’s future. Maserati, a cornerstone of Italy’s automotive heritage, faces mounting pressure to adapt to the rapidly changing automotive market, particularly with the shift towards EVs and stricter emission regulations.
Government Measures and Future Prospects
In response to the downturn, Stellantis has increasingly relied on state-funded temporary layoff schemes to address overcapacity at its Italian plants. These schemes have helped mitigate the impact of declining production on workers, but they cannot be seen as a long-term solution to the underlying issues facing the company.
Despite the current challenges, Stellantis has laid out plans to boost production in Italy, with expectations for growth beginning in 2026, driven primarily by the launch of new models. In December 2024, the company announced a €2 billion investment in Italy, aimed at revamping its plants and increasing production capabilities for upcoming vehicle models. However, this investment will not immediately reverse the downward trend in production, and significant uncertainty remains around the company’s ability to execute its long-term strategy in the face of mounting industry pressures.
The Broader European Auto Industry Crisis
Stellantis is not alone in facing difficulties. Like many of its European peers, the company is grappling with a challenging market environment. A combination of weak demand, particularly for fully electric vehicles (EVs), and tough competition from Chinese manufacturers has put pressure on European carmakers. The EU’s stringent emissions regulations, which are set to come into force in 2025, have further complicated matters, as manufacturers face the challenge of meeting increasingly ambitious carbon reduction targets while transitioning to electric mobility.
The FIM-CISL union has voiced strong concerns about these challenges, particularly the European Union’s current approach to vehicle emissions regulations. Uliano warned that the EU’s targets could have devastating consequences for the European car industry if they are not re-evaluated. “This is a battle for Europe,” Uliano asserted. “Single countries can only lose.” The union has pledged to join a protest in Brussels on February 5, organised by IndustriALL Europe, to demand a reconsideration of the EU’s carbon emissions reduction targets, which are set to take effect in 2025.
A Shifting Landscape for Stellantis and the Italian Auto Industry
The situation at Stellantis’ Italian plants mirrors the broader challenges facing Italy’s automotive sector. The country has long been a leader in car manufacturing, but with production at historically low levels, the outlook is uncertain. The decline in production is likely to have far-reaching consequences for Italy’s economy, particularly in regions heavily reliant on the car industry, such as Piedmont and Emilia-Romagna, where many Stellantis plants are located.
The investment plan announced by Stellantis in December is a positive step, but it will take several years to yield results. As the company transitions to new models, it will need to adapt quickly to the fast-changing automotive landscape, which includes the global push towards electrification, the growing presence of Chinese manufacturers in Europe, and increasing pressure from both governments and consumers for more sustainable practices.
For now, Stellantis is navigating a complex web of challenges. The company must contend with weak demand, overcapacity in its plants, regulatory uncertainty, and a competitive market in which electric vehicles and autonomous driving technologies are quickly gaining prominence. How Stellantis responds in the coming years will likely shape the future of the company in Italy and across Europe.
The Future of Stellantis in Italy: Key Questions Remain
Despite the tough year in 2024, the future of Stellantis in Italy remains tied to its ability to execute its long-term plans for growth and transformation. The company’s investment in new models and its focus on the transition to electric vehicles are central to its strategy for overcoming current challenges. However, the Italian government, unions, and industry stakeholders will need to work closely with Stellantis to ensure that the sector is not left behind in the global shift towards electric mobility.
With the 2025 EU emissions regulations fast approaching, the carmaker’s future success will depend on its ability to align its operations with both regulatory demands and changing consumer expectations. Whether or not Stellantis can regain its footing in Italy and rebuild its production capabilities will be crucial not only for the company but for the future of Italy’s automotive industry as a whole.
For now, all eyes will be on the coming years as Stellantis seeks to navigate the evolving landscape of the European auto industry, adapt to the growing demand for electric vehicles, and chart a course towards a more sustainable future. However, the road ahead is fraught with challenges, and the Italian automotive sector is facing one of its most uncertain periods in decades.