LANSING, Mich. (Michigan News Source) — For the first time in 20 years, Italy’s auto workers went on strike, with Stellantis at the center of their grievances. Formed in 2021 from the merger of Fiat-Chrysler and PSA Peugeot, the global automaker has been under scrutiny as production cuts and strategic shifts raise concerns among its workforce. 

On Friday, tens of thousands of workers marched through Rome waving red union flags and demanding better working conditions while also urging the Italian government to safeguard the country’s carmaking industry. As Stellantis scales back output in its Italian plants, the strike reflects the anxieties of workers who have had their working hours slashed to just one or two days a week.

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Riccardo Falcetta, a leader of the UIL metalworker union in Bari, spoke to the urgency of the moment: “The ecological transition cannot be exclusively paid for by the workers,” he said, according to The Associated Press. 

Stellantis, now the world’s fourth-largest automaker, finds itself caught between the demands of European regulations and the realities of global competition. 

CEO Carlos Tavares has been vocal about the impact of European Union carbon emissions rules, which he argues are driving up production costs. To remain competitive against lower-cost Chinese alternatives, Tavares has suggested that Stellantis may have to consider plant closures or job cuts. 

The strikes come against the backdrop of a sharp decline in production at Stellantis’ Italian plants. Over the past 17 years, the company has reduced its output in Italy by nearly 70%, and the first half of 2024 saw further declines. 

Italy’s far-right government has been especially critical, accusing Stellantis of relocating production to countries where labor is cheaper.

Stellantis’ challenges, however, are not confined to Europe. 

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The company’s financial struggles have also caused tension across the Atlantic, where its U.S. operations—including those in Michigan, an important base for its North American activities—face their own uncertainties.

Most recently, Stellantis issued a profit warning, predicting losses of up to $11.2 billion by the end of the year.  The losses primarily stem from the high costs of transitioning to electric vehicles and weaker sales of high-priced models in the U.S.

Stellantis is now seeking a successor for Tavares, whose leadership has come under scrutiny amid financial struggles and tensions with U.S. dealers and the United Auto Workers union. Tavares, who has tried to stabilize the company through cost-cutting measures like factory delays, layoffs, and buyouts, could potentially stay on beyond the end of his contract in 2026.