Major car brand pauses production of electric vehicle as Stellantis bosses warn of 'deep trouble'
Stellantis has extended the pause on manufacturing of its Fiat 500e model
STELLANTIS
Major manufacturer Stellantis has announced an extension to the production suspension of its electric Fiat 500 model until November 1 as demand for EVs falls.
The decision comes as a result of poor demand for the vehicle, which is manufactured at the company's historic Mirafiori plant in Turin, northern Italy.
Initially, Stellantis had planned to halt production until October 11. However, the prolonged suspension reflects the challenges facing the electric vehicle market in Europe.
In a statement to trade unions, Stellantis described the European electric car market as being "in deep trouble" as a result of the global slowdown in EV sales.
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The Fiat 500e is the UK's most common electric convertible FIATThe global slowdown in EV sales has been attributed in part to diverging policies on green incentives across different markets, most notably from the Italian Government.
Despite these challenges, Stellantis has reaffirmed its commitment to electric vehicle production, with a €100million (£83million) investment in its Fiat 500e model, equipping it with a high-performance battery.
Additionally, Stellantis has announced plans to begin production of a new 500 Hybrid model in early 2026 as it looks to diversify its vehicle output.
In Italy, the government has launched a €1billion (£831million) plan to encourage drivers to switch to cleaner vehicles including subsidies for the purchase of fully-electric cars.
In light of these developments, Stellantis CEO Carlos Tavares is set to address an Italian parliamentary committee on 11 October. The hearing will focus on the prospects for the carmaker's production in Italy.
Stellantis stated that Tavares will "provide the most exhaustive picture of the group's automotive production in Italy".
The CEO's appearance before the committee underscores the importance of Stellantis' operations in Italy. It also highlights the need for dialogue between the automotive industry and policymakers.
It comes as Italy's Industry Minister Adolfo Urso demands an urgent review of EU emissions rules and the 2035 ban on internal combustion engines.
Urso, a member of Prime Minister Giorgia Meloni's Brothers of Italy party, claims the ban has already created a "grave crisis" for European carmakers.
The minister argues that the EU's Green Deal roadmap has exposed its contradictions, citing a collapse in the European electric vehicle market.
"The data speaks for itself. It's already clear the road map...is not sustainable," Urso told the Financial Times.
He warns that hundreds of thousands of European car manufacturing jobs are at risk unless Brussels eases its ambitious environmental goals for the automotive sector.
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Adolfo Urso said changes needed to be made to protect European industry REUTERSThe minister's push reflects broader resistance to the EU's Green Deal within the automotive sector. The European auto lobby ACEA recently called for "relief" from intermediate CO2 targets set for 2025.