Stellantis Plans To Build Two More Hybrid Vehicles In Italy Amid Political Tensions: Report

Automaker Stellantis NV STLA is reportedly considering the production of two additional hybrid vehicles in Italy, a move seen as an attempt to placate local politicians while contemplating shifting some manufacturing to cheaper countries.

What Happened: The automaker plans to manufacture hybrid versions of a Jeep model at the Melfi plant in southern Italy and the Fiat 500 at the Mirafiori facility in Turin, Bloomberg reported on Monday. The information comes from sources familiar with the matter.

Chief Executive Officer Carlos Tavares is set to present this proposal during a meeting with local unions in Turin on Monday. The initiative is part of Stellantis's strategy to increase its vehicle production in Italy to 1 million units by 2030, up from approximately 750,000 last year.

Stellantis's plans hinge on the level of support from the Italian government and unions, the sources added. Discussions between the carmaker, the government, and local unions will continue following Monday's meeting.

Stellantis is yet to respond to the queries sent by Benzinga.

Earlier this month, Italy's financial police seized several Fiat Topolinos, claiming they displayed the national flag despite being assembled in Morocco. This incident is part of an ongoing conflict between the Italian government and Stellantis.

See Also: Jeep’s All-Electric Wagoneer S Beats Tesla Model Y Performance In Acceleration Test, Lags Behind Model X

Thousands of Italians recently protested near Stellantis's Turin base, anticipating further job cuts. Meanwhile, the Italian government has been in talks with other carmakers, including Tesla, BYD, and Dongfeng Motor Group, about potential production opportunities in Italy.

Why It Matters: The decision by Stellantis to expand hybrid vehicle production in Italy comes amid significant political and economic pressures. Earlier this year, Italian Prime Minister Giorgia Meloni criticized Stellantis for shifting production abroad, raising concerns about job losses and economic impact.

Additionally, Stellantis has been adapting to the electric vehicle (EV) challenge by cutting costs through global job shifts, following the lead of Tesla. The company’s latest move to propose the production of new hybrid models in Italy is seen as an effort to balance these cost-cutting measures with the need to maintain domestic production and appease local stakeholders.

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Photo by Jonathan Weiss on Shutterstock

This story was generated using Benzinga Neuro and edited by Pooja Rajkumari