What's Happening?
Stellantis, the automotive giant, experienced a significant 20% decline in its Italian vehicle production in 2025, marking the lowest output since 1954. The company's Italian plants produced 379,706 units, with passenger car production down by 24.5% to 213,706 units. This decline has resulted in Italy dropping out of the top 20 car-producing countries globally. The Fiat plant in Mirafiori, Turin, was a rare bright spot, showing a 16% increase in production, largely due to the late launch of the Fiat 500 hybrid. However, other plants like Cassino and Melfi faced severe contractions. Italian labor unions are calling for immediate investments and new models to reverse the trend.
Why It's Important?
The decline in Stellantis' Italian production has significant implications
for the automotive industry and the Italian economy. The reduction in output affects employment, with many workers facing reduced hours and short-time working arrangements. This situation highlights the challenges faced by traditional automotive manufacturing in Europe, including competition from Chinese manufacturers and shifting consumer preferences towards electric vehicles. The decline also underscores the need for strategic investments and innovation to maintain competitiveness in the global market.
What's Next?
Stellantis plans to address the production decline by targeting a significant turnaround in 2026. The company aims to increase the production of the Fiat 500 hybrid to 100,000 units annually. Additionally, labor unions are urging Stellantis to expedite its industrial plan, initially promised for the first half of 2026, to stimulate production and secure jobs. The Italian government, which had set a target of one million annual production units, may also need to reassess its strategies to support the automotive sector.
