TURIN – Stellantis CEO Carlos Tavares has advised Italian unions that he’ll work with them to enhance competitiveness and minimize manufacturing prices at factories in Italy, the place they presently are as much as 4 instances greater than in France or Spain for the same mannequin.
Tavares, who met with union representatives at two former Fiat Chrysler factories within the Turin space this week, mentioned the issue was primarily not labor prices however manufacturing prices on fashions that didn’t promote in anticipated numbers.
Unions have been nervous that the merger of PSA Group and FCA to kind Stellantis, which was finalized final month, may end in job losses, particularly in Italy. Tavares has pledged to not shut any meeting vegetation in Europe on account of the merger.
A union supply who attended the assembly advised Automotive Information Europe that Tavares gave employees a number of examples of the associated fee discrepancy between the Turin-area vegetation and people at PSA vegetation in Europe.
Tavares mentioned the Maserati Levante midsize luxurious SUV incurred about 3,300 euros in direct manufacturing prices per automobile on the FCA manufacturing unit in Mirafiori, whereas the Ghibli and Quattroporte luxurious sedans value about 6,000 euros per unit on the close by Officine Giovanni Agnelli manufacturing unit in Grugliasco.
In distinction, Tavares mentioned that direct manufacturing prices for the same automobile inbuilt France, such because the DS 7 Crossback inbuilt Mulhouse, would quantity to about 1,400 euros.
He mentioned the Fiat New 500 full-electric small automotive, which is inbuilt one other a part of the large Mirafiori advanced, incurs about 1,200 euros of direct manufacturing prices, in contrast with 500 euros for the same Opel Corsa-e constructed on the PSA plant in Zaragoza, Spain.
A Stellantis spokesman confirmed the figures, explaining that direct manufacturing prices included labor; amortization of R&D, tooling and plant structural prices; and power use.
Three business specialists consulted by ANE for this text mentioned direct manufacturing prices symbolize about 20 p.c of the full manufacturing value of a quantity mannequin, and as much as 35 p.c for low-volume premium and luxurious fashions. Materials accounts for the rest.
Tavares reassured Italian unions that labor prices are usually not the primary challenge, noting that they’re larger at PSA vegetation in France, however the direct manufacturing prices he cited added to worries about the way forward for the Grugliasco plant, a union supply mentioned.
“We really feel that it will be very troublesome to regain sufficient competitivity in Grugliasco, given such a large hole to shut not solely on French vegetation, however even to close by Mirafiori,” the supply mentioned.
FCA thought of Grugliasco, a former Carrozzeria Bertone plant that it purchased in 2009, as a part of a single manufacturing hub with Mirafiori, which is about 3.5 miles away. That would make it simpler to shut Grugliasco and transfer employees to the Mirafiori plant. FCA had moved Maserati employees between the 2 vegetation in response to mannequin demand for years.
Grugliasco employs 1,149 assembly-line employees and Mirafiori 2,766, in response to figures from the FIM-CISL union.
Tavares’s message to the employees is that future investments in former FCA vegetation in Italy must be “right-sized” to enhance competitiveness – and never lose future mannequin allocations to different Stellantis vegetation throughout Europe.
Business specialists say amortization of R&D, tooling and plant structural prices add as much as about 15 p.c of complete manufacturing prices per unit for a selected mannequin.
These prices don’t fluctuate with the manufacturing quantity. “Should you construct half of the quantity deliberate for a mannequin, the burden of these prices doubles” on every automotive bought, an business government who requested to not be quoted by title advised ANE. “Should you construct a fourth (of the deliberate quantity), they quadruple.”
FCA invested 500 million euros on the Grugliasco plant to launch the Quattroporte in 2012 and the Ghibli a yr later. Most put in capability was about 30,000 items yearly on two shifts a day, and mixed manufacturing of the 2 fashions peaked at 36,100 in 2014, in response to FIM-CISL figures. However complete manufacturing was simply 6,900 in 2019 and fell additional to six,676 final yr.
Then in 2014 FCA invested an extra 300 million euros on the Mirafiori advanced to put in a brand new manufacturing line, together with a paint store, devoted to the Maserati Levante SUV. The Levante, which shares its structure with the Quattroporte and Ghibli, had a superb begin, with manufacturing peaking at 33,960 in 2017.
Based on union figures, complete Maserati manufacturing was 17,694 final yr, with 11,018 Levantes at Mirafiori and the remaining Quattroportes and Ghiblis at Grugliasco.
The Mirafiori advanced was one of many world’s largest auto vegetation when it was inaugurated in 1939 by Fiat founder Giovanni Agnelli and the Italian fascist chief Benito Mussolini. At its peak, greater than 50,000 folks labored at Mirafiori. By 1997, 26,500 employees constructed 463,000 autos.
It now employs a complete of 10,000 manufacturing employees and seven,000 workplace employees, primarily in advertising and gross sales, R&D and administration. It homes the Levante and New 500 manufacturing strains, a stamping facility, a powertrain plant and most of Stellantis’ Italian administrative and engineering employees.
Final yr Mirafiori produced 30,026 autos, in response to the FIM union, of which 19,008 had been Fiat New 500s and the remaining Levantes.
Tavares has visited different Stellantis vegetation in Italy lately, and a union supply mentioned he was impressed by a stage of automation at Cassino and Melfi that was appreciable larger than at comparable former PSA vegetation.
Rising manufacturing unit automation was a method put in place within the mid-Eighties at FCA’s predecessor, Fiat Auto, as a response to conflicts with unions within the earlier decade, which peaked when employees occupied the Mirafiori plant for 35 days in October 1980.
The concept was to weaken dependence on employees – and their contractual energy — by lowering the variety of direct jobs. The Melfi plant, which opened in 1993, employed 8,000 folks and 340 robots to construct as much as 400,000 items a yr. In distinction the Rivalta plant close to Turin that was opened in 1967 (and is now closed) wanted virtually 18,000 folks — and nearly no robots — to construct 400,000 items a yr within the early Seventies.
However seen one other means, the excessive stage of automation at these factories — one other type of overinvestment — is perhaps a barrier to lowering prices. The preliminary, pricey funding must be amortized, and total flexibility is considerably diminished, as a result of people could be instructed to make issues in a different way sooner that machines could be reprogrammed, the union supply mentioned.
Andrea Malan contributed reporting