Stellantis announces hybrid model production in Italy amid electrification uncertainty

Stellantis has announced significant plans to bolster its manufacturing operations in Italy. On 27th May, during a meeting in Turin, Stellantis CEO Carlos Tavares outlined the company's future production strategy to union partners, emphasising flexibility in response to uncertain electrification trends.

Tavares officially announced the development of a hybrid version of the Fiat 500 to be manufactured at the Mirafiori factory. Additionally, the Melfi plant will produce a new hybrid version of the Jeep Compass. These announcements follow recent plans to enhance the Fiat 500e with a new generation of batteries and the industrial expansion of the Fiat Panda hybrid in Pomigliano.

Impact on production and employment

The introduction of these hybrid models is expected to positively impact the workload at the Termoli plant and the Mirafiori e-DCT and transmissions plants. Stellantis anticipates that the success of this plan will lead to the hiring of young workers, particularly at the Mirafiori factory, as part of a generational renewal of the workforce.

Addressing competitiveness and external challenges

Tavares highlighted the importance of offering affordable and high-quality cars to Italian customers, which requires enhancing Stellantis's competitiveness in collaboration with suppliers and Italian institutions. He noted that while the company is addressing internal factors, several external challenges need to be tackled. These include high energy costs, inadequate charging infrastructure for battery electric vehicles (BEVs), and market support mechanisms. Tavares also mentioned the need for initiatives to encourage conversion and retraining of the workforce to adapt to new manufacturing demands.

Aiming for increased production

The shared ambition between Stellantis and the Italian government to produce one million vehicles in Italy by 2030 was reaffirmed. However, Tavares cautioned that achieving this goal would require a supportive business environment, especially given the uncertainties surrounding electrification and the intense competition from new market entrants.

Why Stellantis is focusing on hybrids?

The decision to produce hybrid models can be seen as a strategic response to the current transitional phase in the automotive industry. With electrification trends still evolving, hybrids offer a bridge between traditional internal combustion engines and fully electric vehicles. This approach allows Stellantis to remain competitive and adaptable, meeting varying market demands while preparing for a more electrified future.

Preparing for an electrified future

Stellantis's announcement also reflects its commitment to transitioning towards more sustainable transportation solutions. By developing hybrids and enhancing the Fiat 500e, the company is positioning itself to cater to the increasing consumer demand for eco-friendly vehicles. The hybrid models serve as an intermediate step, enabling Stellantis to gradually scale up its electric vehicle production capabilities while continuing to utilise existing manufacturing infrastructure.

Collaboration with stakeholders

Tavares's emphasis on collaboration with suppliers and Italian institutions underscores the need for a cohesive approach to tackle the challenges of the automotive industry's transformation. Addressing high energy costs, expanding the charging network for BEVs, and implementing market support tools are critical for creating a conducive environment for the growth of hybrid and electric vehicles.

Stellantis's latest announcements indicate a proactive approach to navigating the complexities of the automotive industry's shift towards electrification. By introducing hybrid models and planning for future electric vehicle enhancements, the company aims to maintain its competitive edge while supporting workforce renewal and addressing external challenges. The commitment to producing one million vehicles in Italy by 2030 underscores Stellantis's long-term vision and the need for a collaborative effort to achieve this ambitious target.