Stellantis Adds New Models to Avert Italy Crisis

Stellantis is taking decisive steps to strengthen its operations in Italy, safeguarding jobs and production facilities while committing to a series of new investments and vehicle models. These efforts come as the company seeks to rebuild trust with the Italian government and its workers after months of tension.

A Renewed Focus on Italy – 

Under the leadership of Chairman and interim CEO John Elkann, Stellantis has committed to keeping all its Italian factories operational and replenishing them with fresh vehicle models. The automaker plans to increase production capacity, forecasting 500,000 units by 2025 and aiming for 750,000 units in 2026—an ambitious 50% rise from current levels.

Jean-Philippe Imparato, Stellantis’ Head of Enlarged Europe, emphasized the importance of concrete results during recent talks with Industry Minister Adolfo Urso. He assured that Italy remains a critical part of Stellantis’s long-term strategy.

“Next year will be tough,” Imparato admitted, “but our industrial plan is built on delivering real machines and engines to our Italian facilities.”

Investments for a Sustainable Future – 

Stellantis will allocate €2 billion ($2.1 billion USD) in Italy next year to upgrade plants and expand production capabilities. Additionally, €6 billion ($6.4 billion USD) in supplier orders will drive local partnerships and boost the regional economy. This investment signals Stellantis’s intent to remain a cornerstone of Italy’s industrial landscape.

The automaker confirmed it had no intention of closing any of its Italian factories and that new models were in the works.

The new lineup includes several exciting additions for Alfa Romeo, headlined by the next-generation Stelvio SUV and Giulia sports sedan, both slated for a 2026 debut. In a shift from its earlier strategy of going fully electric, Alfa Romeo will now offer these models with both electric (EV) and hybrid powertrain options to better align with market trends. Additionally, an all-new, yet-to-be-named flagship model will join the range. All three vehicles are set to be produced at the Cassino Assembly Plant near Piedimonte San Germano, Italy, further cementing the site’s importance in Alfa Romeo’s future.

Beginning in early 2025, Stellantis will ramp up operations at its Melfi Assembly Plant in southern Italy. Previously known for producing the Jeep® Renegade, Jeep Compass, and Fiat 500X, the facility will shift focus to assembling a mix of EV and hybrid vehicles. These will include the next-generation European Jeep Compass, the stylish Lancia Gamma, the DS 7, and the fully electric DS 8. A fifth model will also join the production lineup later, showcasing the plant’s growing role in Stellantis’ electrification strategy.

At the legendary Mirafiori plant—Fiat’s original factory—Stellantis is preparing to launch production of a hybrid version of the Fiat 500, with operations expected to commence by late 2025. The company has committed to keeping the Fiat 500 in production at Mirafiori until at least 2032, highlighting its long-term dedication to this iconic model. Additionally, Mirafiori will significantly expand its gearbox production capacity, increasing output from 600,000 to 900,000 units annually to support growing demand.

Government Support and Collaboration – 

Prime Minister Giorgia Meloni has reiterated her government’s readiness to collaborate, provided Stellantis remains committed to maintaining jobs and industrial stability. To support the sector, the Italian government is preparing to invest over €1 billion ($1.07 billion USD) in 2025, with further incentives likely on the table.

“We evaluate economic cases on their own merits,” Meloni stated. “If there is a willingness to maintain factories and jobs, we will do our part.”

Challenges and Opportunities – 

While Stellantis’ renewed focus on Italy marks a positive shift, the company continues to grapple with significant challenges, including overcapacity in Europe and a cooling market for EVs. Previous decisions to relocate production to more cost-effective countries like Poland had strained relations with Italian officials. However, under John Elkann’s leadership, these tensions have begun to ease, steering the company toward a more collaborative and growth-oriented path.

This marks a noticeable departure from the approach seen under former CEO Carlos Tavares. For instance, in May, Italian authorities confiscated 134 Fiat Topolino electric city cars at the port of Livorno due to a minor violation involving a small Italian flag sticker on the car’s bodywork. This sticker breached a niche law intended to safeguard the integrity of Italian-made products. Ironically, despite carrying the Fiat badge, the Topolino is manufactured at Stellantis’ Moroccan facility alongside its Citroën Ami counterpart.

A few months earlier, Alfa Romeo faced public criticism over plans to produce its new compact EV crossover in Poland. Originally named “Milano” to honor the brand’s Italian heritage, the vehicle was rebranded as “Junior” following strong opposition from government officials. These controversies underscore the delicate balance Stellantis must maintain as it seeks to align its global production strategies with national expectations.

Sources: Bloomberg and Agenzianova