Italy’s Auto Crisis: Stellantis Output Drops 37%

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In a country renowned for iconic brands like Fiat, Alfa Romeo, and Maserati, 2024 marked a devastating chapter in Italy’s automotive history. Stellantis—the global conglomerate behind these names—reported a staggering 37% decline in total vehicle production, plunging from 751,384 units in 2023 to just 475,090 in 2024.

Passenger car output fell by an even more alarming 46%, dragging Italy’s production to its lowest level since 1956. Commercial vehicle manufacturing dropped 17%.

This collapse is not an isolated event—it is symptomatic of broader structural challenges across Europe’s automotive sector, where weak electric vehicle (EV) demand, regulatory uncertainty, and fierce competition from Chinese brands are colliding in a perfect storm.

A Sector in Freefall: The Numbers Behind the Collapse

Stellantis operates five passenger car plants and one commercial vehicle facility in Italy.

All reported serious contractions:

• Mirafiori (Turin): Production collapsed by 70%, driven largely by weak demand for the Fiat 500e and Maserati models.

• Modena (Maserati plant): Output plummeted by 79%, exposing vulnerabilities in the luxury segment.

• Pomigliano d’Arco and Atessa: These relatively stable plants still saw declines of 5.5% and 10.2%, respectively, in Q3 2024.

The decline was so sharp that Stellantis had to rely heavily on state-funded temporary layoff schemes. Mirafiori halted production for weeks at a time, with shutdowns stretching from mid-September to January 2025.

Why Production Collapsed: Three Major Drivers

1. Weak Demand for EVs

Stellantis’ strategy hinged on EV adoption, especially with models like the Fiat 500e, which held a 45% share of the A-segment BEV market. But even that wasn’t enough:

• Fiat 500e sales dropped from ~65,000 units in 2023 to an estimated 20,000 in 2024.
• In Italy alone, only 4,749 Fiat 500e units were sold in 2023.

Why?

• High cost: The 500e starts at €34,095—pricey for a city car.

• Subsidy instability: EV incentives in Germany were removed; Italy delayed its own eco-bonus program.

• Infrastructure gaps: European charging networks remain uneven, deterring buyers despite rising climate urgency.

2. Regulatory Uncertainty

Europe’s climate ambitions—while commendable—are creating chaos on the ground. Stellantis and other automakers are scrambling to comply with:

• Stricter CO₂ targets effective 2025
• Unpredictable subsidy policies
• Costly fleet compliance penalties

Rather than stimulate innovation, these pressures are prompting production halts, factory reprogramming, and shifting allocation strategies.

3. Chinese Competition

Europe’s automakers are being outpaced by Chinese EV giants like BYD, Geely, and Chery.

In 2024:

• Chinese-made EVs captured 25% of Europe’s EV sales, up from 19.5% in 2023.
• BYD sold over 4.27 million NEVs globally, a 40% jump from the year before.
• Competitive pricing (e.g., BYD Atto 3) is pulling cost-conscious buyers away from domestic brands.

Even as the EU imposed up to 35.3% tariffs on Chinese EVs in late 2024, the damage was already done—and the risk of trade retaliation now hangs over the recovery effort.

Beyond Stellantis: Europe’s Systemic Struggles

Italy’s crisis is part of a continent-wide pattern:

While Italy’s car market saw a 19% rebound in 2023 (to 1.57 million vehicles), 2024 plateaued due to production constraints and weakening consumer demand.

Other manufacturers fared better: Renault overtook Stellantis in market share in December 2024—a stunning reversal given Stellantis’ scale and branding power.

Economic and Employment Fallout

Italy’s auto industry contributes over 5% of national GDP and supports more than 270,000 jobs. The 2024 production collapse reverberated through:

• Job cuts and voluntary exits (e.g., 500 at Melfi)
• National strike action in October 2024—the first in two decades
• Wage pressure and layoffs at supplier plants across the country

Temporary layoffs kept plants like Mirafiori on life support, but public trust—and political patience—is wearing thin.

What Comes Next?

While recovery strategies (including Stellantis’ €2B plan and Fiat Pandina relaunch) are on the table, the crisis in Italy’s automotive sector is far from over.

Short-term forecast:

• 2025 will bring additional regulatory hurdles and consumer hesitation.
• Stellantis’ financials reflect the strain—net profits in 2024 dropped by 70%.

Broader warning signs:

• Italy’s challenges are not unique—France and Germany face similar EV adaptation woes.
• European automakers risk being squeezed out by foreign players if pricing, innovation, and policy don’t realign.

Conclusion: A Cautionary Tale for Europe

The 37% production drop by Stellantis in Italy is more than a national crisis—it’s a signal flare for the future of Europe’s automotive sector. EV adoption is moving slower than forecasted. Policy volatility is unsettling industry investment. And global rivals are gaining ground fast.

What Italy’s 2024 crisis reveals is not just what went wrong—but what happens when even iconic brands can’t keep pace with a rapidly shifting market.

If Europe’s carmakers are to survive this transition, they must do more than electrify. They must rethink how they build, price, and sell mobility itself—before the ground disappears beneath them.

At moments of deep disruption like this, interim leadership becomes essential. CE Interim supports automotive clients with hands-on transformation experts—ensuring stability, execution, and speed when it matters most.