Stellantis is considering whether to close one of two production lines at its Melfi car plant in southern Italy, the head of the FIM CISL union told Reuters.
Jeep’s Renegade and Compass models and the Fiat 500X compact SUV are produced at Melfi, which is considered Stellantis’ most efficient plant in Italy, but they could be moved to a single production line.
Closing a line at Melfi could mark the first step by CEO Carlos Tavares to tackle excess capacity in Italy.
Stellantis was not immediately available for comment.
The carmaker’s production in Italy is under scrutiny for costing more than elsewhere, as Stellantis seeks more than 5 billion euros ($5.9 billion) a year in savings following its creation from the merger of France’s PSA Group and the Italian-American Fiat Chrysler earlier this year.
Downsizing plants was at the heart of Tavares’ “back in the race” strategy at PSA, where he helped the Peugeot maker recover from near-bankruptcy around a decade ago.
All plants producing fewer than 250,000 vehicles per year saw their capacity cut from two production lines to one to maximize capacity at the remaining line.
In France, PSA took that route with its assembly plants at Rennes, Poissy and Mulhouse. It later applied the same approach at Opel-Vauxhall plants when it bought the business from General Motors Co.
FIM CISL’s Ferdinando Uliano said the plan at Melfi was being assessed and Stellantis had not made a decision. The union had yet to receive official confirmation that the project was being considered, he added.
Tavares has committed not to close plants or cut jobs.
“We are very worried,” Uliano said. “Once you have reduced production capacity at one site, it’s very difficult to gain it back”.
Elsewhere in Italy, Turin’s Mirafiori has two lines, while all of Stellantis’ other sites in the country have one.
Unions will meet with Stellantis’ ‘enlarged Europe’ region top executives on April 15 in Turin to discuss the outlook for the group’s production sites in Italy.
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