Italy open to taking a stake in carmaker Stellantis

Rome — The Italian government is open to buying a stake in carmaker Stellantis, industry minister Adolfo Urso said on Thursday, as he set out plans to provide €950m in subsidies in 2024 to help drivers switch to cleaner cars.

The new incentive scheme follows a clash between Italy’s rightist government and Fiat-owner Stellantis over production levels in the country.

Urso said Stellantis has committed to boosting production in Italy back to level of 1-million vehicles a year, a figure last hit in 2017. The total in 2023 was about 750,000.

France holds a 6% stake in Stellantis, the group formed in 2021 through the merger of Fiat Chrysler and France’s PSA Group. Italy’s Agnelli family is the largest investor in Stellantis through its Exor vehicle.

Urso went on to suggest that Italy could match the French government by taking a stake in the carmaker, whose other brands include Peugeot and Jeep.

If Stellantis CEO Carlos Tavares, “maintains that Italy needs to do the same as France, which has boosted its active investment in Stellantis, then they can ask. We can discuss it together,” Urso told reporters on Thursday.

Prime Minister Giorgia Meloni said last week that Stellantis, which also has major businesses in France and America, has sometimes acted against the national interest.

As an opposition politician, Urso has in the past called for state lender Cassa Depositi e Prestiti (CDP) to buy a stake in Stellantis.

Last June, Stellantis chair John Elkann said his company did not need to add the Italian state to its shareholders.

Tavares, who is Portuguese, has said that Italy spends less than other major European countries to support the development of electric vehicles and that approach is holding back production.

The measures announced on Thursday will help Italy to renew what is one of the oldest car fleets in Europe.

Rome will provide up to €13,750 in subsidies for the lowest earners to help them buy a new fully electric vehicle costing up to €35,000 excluding VAT. Part of the subsidy is linked to scrapping an existing polluting combustion-engine car. The same income group can also get a subsidy of up to €10,000 for a new plug-in hybrid costing up to €45,000.

State-of-the art combustion engine vehicles will qualify for subsidies as well, though they will be smaller.

The incentives, which had been expected for months, are more generous than those they replace, which amounted to up to €5,000 for electric vehicles. The outlay is part of a wider multiyear programme, worth more than €8bn, that Italy announced in 2022 to support its car industry.

Urso said Rome could channel public resources from 2025 directly to new production plants in Italy should incentives continue to mainly fund cars made in foreign factories.

Davide Mele, head of corporate affairs for Stellantis Italy, said the package should help support the domestic car industry.

“We make cars based on consumer demand ... That’s why it is fundamental to stimulate demand with cars at affordable prices,” he told the meeting with government officials and unions.

The French government has offered buyers a cash incentive of between €5,000 and €7,000 to get more electric cars on the road, at a total cost of €1bn a year.

Reuters