Stellantis is considering investing in battery manufacturing in Italy
The Italian government is in talks with Stellantis, the automaker created through the merger of Fiat Chrysler Automobiles and PSA Group, to invest in the production of batteries for electric vehicles in the country, according to people familiar with the matter.
A meeting in Rome this week between the chairman of Stellantis, John Elkann, CEO Carlos Tavares, and Giancarlo Giorgetti, Italy’s Minister for Economic Development, revolved around the future of electromobility in the country.
Giorgetti asked Stellantis for assurances that Italy would remain one of the main countries in which the company manufactures vehicles and asked about plans to invest in battery manufacturing in Mirafiori, Fiat’s main industrial area in Turin.
Stellantis spokesmen and the minister declined to comment. Discussions are at an early stage, no final decision has been made and the company may decide to invest in battery production elsewhere.
The 62-year-old Tavares is in a difficult position as head of what is now the second largest automobile manufacturer in Europe, just behind the Volkswagen Group.
France recently put pressure on former head of Peugeot maker PSA to maintain engine power, which the company would move to Hungary. Stellantis executives have been negotiating with the UK government for months to help convert a car factory in England amid the pending ban on internal combustion vehicles.
PSA continued to invest in electric vehicles before the merger with Fiat and had plans for a roughly 5 billion euro project with oil giant Total, which is supported by the French government. With PSA selling more plug-in hybrids and battery-powered cars, Stellantis was able to terminate an emissions credit agreement that Fiat signed with Tesla in 2019.
Stellantis employs more than 50,000 people in several dozen production facilities in Italy. Last year, the government led by Prime Minister Giuseppe Conte approved a € 6.3 billion ($ 7.7 billion) credit facility for Fiat, the largest government-backed funding to a car maker in Europe during the coronavirus pandemic was arranged.
As part of its push for the green transition, the new government, led by Mario Draghi, plans to invest around 25 billion euros in European Union recovery funds in new infrastructure and to top up this amount with domestic funds for a total investment of more than 31 billion euros.
The plan envisages renewing the public transport fleet with zero-emission and low-emission vehicles and providing around 8.5 billion euros for sustainable mobility, including 21,000 public quick-charging stations.
Tavares has vowed to speed up Stellantis’ electrical circuit and predicts battery-powered cars will account for more than a third of European sales by the middle of the decade. The maker of Fiats, Peugeots and Jeeps expects to triple sales of plug-in hybrid and fully electric vehicles to more than 400,000 units this year.
The CEO said last month that Stellantis will aim to secure 250 gigawatt hours of battery capacity by the end of the decade. Decisions could be made this year to develop additional battery factories in Europe and North America, and the company has scheduled an investor briefing about its EV strategy on July 8th.
Fiat has been making cars at its legendary Mirafiori plant since 1939. Mirafiori has already been a hub for the company’s EV production, starting with the electric version of the Fiat 500. Stellantis plans to produce electric versions of the Maserati Gran Turismo and Gran Cabrio models in Turin in mid-2022.