Stellantis Extends Fiat 500 Electric Production Halt Due To Low Demand

Stellantis STLA will prolong the suspension of its Fiat 500 electric city car production until Nov. 1, citing weak demand.

What Happened: The Fiat 500e is manufactured at Stellantis’ historic Mirafiori plant in Turin, northern Italy. Initially, production was halted until Oct. 11. The company informed trade unions that the European electric car market is “in deep trouble,” according to a statement, Reuters reported on Tuesday.

A global decline in electric vehicle (EV) sales, partly due to inconsistent green incentive policies, has led automakers worldwide to revise their EV strategies. Despite the temporary production halt, Stellantis reaffirmed its commitment to invest 100 million euros ($110.93 million) in the Fiat 500e, featuring a high-performance battery.

Additionally, Stellantis plans to start producing the new 500 Hybrid from early 2026. Earlier this year, Italy introduced a $1 billion initiative to encourage drivers to switch to cleaner vehicles, offering subsidies for fully-electric car purchases.

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Why It Matters: Stellantis’ decision to extend the halt in Fiat 500e production underscores the ongoing challenges in the European EV market. In September, Stellantis had already announced a four-week production halt due to “profound difficulties” in the European market. The company cited a lack of orders and market difficulties faced by all producers, especially in Europe.

The European EV market has been grappling with fluctuating green incentive policies, which have affected consumer demand. Stellantis’ commitment to investing in a high-performance battery and introducing a hybrid version of the Fiat 500e by 2026 indicates its strategy to adapt to these market challenges. Italy’s recent $1 billion initiative to promote cleaner vehicles highlights the country’s efforts to support the transition to electric mobility.

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Image via Stellantis

This story was generated using Benzinga Neuro and edited by Pooja Rajkumari