Charting New Frontiers: The Impact of European Automotive Industry Changes on Italian Suppliers

Type de publication:

Conference Paper


Gerpisa colloquium, Bordeaux (2024)


Automotive industry, electrification, Italy, Suppliers


In recent years, the European, and specifically the Italian, automotive industry has undergone significant changes. Firstly, there has been the emergence of new integrated peripheries in Europe and neighboring regions, such as Central and Southeastern Europe, Turkey, and North Africa. These new automotive trends have impacted the core regions in Western Europe. In terms of production, notable decreases have been observed in France and Italy, with respective reductions of -62% and -58% in automotive production between 1991 and 2022. A second major change in the Italian automotive industry is the merger of Fiat Chrysler Corporation, the Italian American car manufacturer that practically dominates the automotive production in the country, with the French Groupe PSA Peugeot Citroën, forming the firm Stellantis. This merger has shifted control and management away from Italy, leading to concerns about Italian influence and autonomy within the company. Additionally, the automotive industry is experiencing a broader transition to electromobility, with the European Union (EU) setting a deadline of 2035 for the commercialization ban on Internal Combustion Engine Vehicles (ICEVs). This transition, along with the rise of new competitors such as Chinese firms and American promotion of Electric Vehicles (EVs) through policies like the Inflation Reduction Act (IRA), poses challenges to the European automotive industry, including Italy's.
Given this context, it is essential to examine how these changes are impacting the Italian automotive supply chain. Italian automotive suppliers, predominantly comprised of small and medium enterprises, have historically been closely tied to the national producer (Fiat, then FCA and now Stellantis). Moreover, the sector has shown positive cross-border trade performance, consistently registering trade surpluses over the past decades. However, given the changes described, questions arise regarding whether Italian suppliers are relocating to new European peripheries, adopting reshoring or offshoring strategies, and how the regional distribution of the Italian supply chain is evolving. Furthermore, it is crucial to understand the ownership control of the main Italian suppliers, as well as their internationalisation strategies and decisions regarding productive location.
Therefore, the goal of this article is to analyse the effects of European and Italian automotive industry changes on the supply chain, focusing on internationalisation, investment localisation decisions, and cross-border trade processes. Methodologies will include both quantitative and qualitative approaches. Specifically, the analysis will involve: 1) Describing the automotive supplier sector using data from the Observatory for Transformations of the Italian Automotive Ecosystem, examining regional distribution, income, and employment features. 2) Analysing Italian auto parts cross-border trade trends over the last 20 years, including regional, auto parts type, and origin/destination of imports/exports based on sources such as Comtrade and ISTAT. 3) Examining ownership control, firm autonomy, and reshoring/offshoring decisions of Italian automotive suppliers based on the 2023 Observatory Survey. 4) Investigating ownership and productive internationalisation changes among the top 200 automotive suppliers in the last decade. Lastly, 5) Conducting in-depth interviews with managers from Italian-based auto parts manufacturers, focusing on internationalisation, investment localisation decisions, research and development (R&D) activities, and cross-border trade processes.
The combination of such different sources and evidence will provide a comprehensive overview of the Italian and European automotive industry, contrasted with the movements of major car manufacturers like Stellantis. This includes examining the incorporation of new integrated peripheries, reshoring/offshoring processes, and the impact of vehicle electrification.

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