- Production at one of the company’s engine plants will be paused for a week.
- Stellantis recently guaranteed that it will not permanently close local factories.
- The Italian government has asked for a “convincing and sustainable plan” for investments by December 16.
Stellantis is pausing production at two of its plants in Italy, which will force it to furlough employees. This move comes amidst simmering tensions between the carmaker and the Italian authorities.
The company recently confirmed to local unions that work at the Termoli engine plant will be halted from December 16-22, while production will stop at the Cassino factory on November 29. Stellantis acknowledged it’s facing “a challenging path requiring difficult choices and offering no easy solutions.” It adds it’s eager to “ensure the continuity” of its Italian operations.
Read: Italian Government Puts Stellantis On Notice – Build Battery Plant Or Lose Funding
Stellantis has paused production at several plants in Italy and overseas throughout the year. However, it recently guaranteed the Italian government and unions that it will not permanently close factories in the country nor make any mass redundancies. The government has also asked Stellantis to present a “convincing and sustainable” plan for local investments by December 16, Yahoo! Finance reports.
While recently speaking at a parliamentary session, Italian Industry Minister Adolfo Urso said Stellantis has been urged to commit to building a new small car locally to help the country’s components sector. It also needs to clarify its plans for a battery production site.
The brand had promised to establish a battery factory in Italy through its ACC joint venture. However, plans for this site, as well as two other battery gigafactories in Europe, were put on hold earlier this year. The joint venture is part-owned by Mercedes and TotalEnergies. It had initially planned to begin operations at a battery plant in Termoli, Italy, in 2026.
In August, Urso revealed that Stellantis is at risk of losing €370 million in public funds from the EU’s post-COVID-19 recovery fund if it cannot commit to the plant.
“Stellantis must give us a reply, and it must do so shortly,” he said. “If Stellantis does not give us a positive feedback within hours, we’ll move… funds elsewhere. We can’t afford to lose these funds because Stellantis is not sticking to its commitments.”
