Italy seeks deal by end of year with Stellantis on car industry plan

FILE PHOTO: The logo of Stellantis is seen on a company's building in Velizy-Villacoublay near Paris

MILAN (Reuters) -The Italian government aims to agree a broad plan to 2030 for the country’s automotive industry with carmaker Stellantis and other groups involved by the end of this year, industry ministry sources said on Tuesday.

Stellantis CEO Carlos Tavares and Industry Minister Adolfo Urso said last month they were working on a deal to increase the group’s annual automotive production in Italy to one million vehicles, without specifying a timeframe for the objective.

Urso, who initially said the deal could be struck by the end of July, said at a meeting with unions on Tuesday that he was looking at drawing up a work programme with Stellantis by the end of September, to prepare talks for the full agreement. The talks will also involve unions, local governments and lobby group ANFIA.

According to union sources, the programme could be announced as early as Sept. 10.

Discussions will focus on expanding Italy’s vehicle production, R&D, labour costs, energy and logistics, and greater investment in green transition, ministry and union sources said.

A spokesman for Stellantis said the group was reaffirming its “strong commitment” to Italy and that it was ready to continue “dynamic and constructive” talks after the summer break.

“Together we are trying to create the conditions to keep Italy’s leading role at the centre of Stellantis’ strategy,” he said.

The spokesman reiterated that a deal with the Italian government would need to take into account several factors including market forecasts, vehicle affordability, incentives both to car purchases and on energy costs and the impact of regulations such as Euro 7.

Tavares said last month that a production target of one million vehicles in Italy was feasible for Stellantis, but depended on adequate government support.

Italy is lagging most European markets in terms of full-electric car registrations.

Stellantis and the Italian government are expected to meet again on Aug. 30, union sources said.

The automaker, the parent of brands also including Alfa Romeo, Jeep and Peugeot, produced fewer than 700,000 cars and vans in Italy in both 2021 and 2022. According to forecasts, output this year should surpass 800,000 units.

Fiat Chrysler, which merged with France’s PSA in early 2021 to create Stellantis, last produced more than one million vehicles in Italy back in 2017.

(Reporting by Giulio Piovaccari and Giuseppe FonteEditing by Keith Weir and Susan Fenton)