Italy in Talks with China’s Chery Auto to Expand National Car Production

The Italian government is discussing with Chery Auto, a prominent Chinese automaker, as part of its ambitious plans to augment national car production. 

With aims to elevate production levels to 1.3 million vehicles annually, Italy seeks to diversify its automotive landscape beyond Stellantis, its sole major automaker. 

These negotiations underscore Italy’s strategic push to bolster its automotive sector and stimulate economic growth.

National Production Targets and Strategic Partnerships:

Italy’s aspirations include ramping Stellantis’ output to one million units per year by the decade’s end, marking a substantial increase from its 2023 production levels. 

Additionally, the government aims to collaborate with a secondary manufacturer, potentially adding 300,000 vehicles to the national output. 

If successful, Chery would become one of the first Chinese automakers to establish a European manufacturing presence, heightening competition, particularly in the electric vehicle (EV) segment.

Market Expansion and Investment Opportunities:

The prospect of Chery’s entry into the European market signals a significant shift in the automotive landscape, as the company anticipates robust sales in the region to support local assembly operations. 

Jochen Tueting, Chery Europe’s Managing Director, affirmed the company’s exploration of various European options for potential manufacturing setups. 

While specific locations remain undisclosed due to non-disclosure agreements, discussions are underway to ascertain the feasibility of establishing production facilities.

Confidential Negotiations and Potential Sites:

Confidentiality surrounds the ongoing talks, with sources refraining from disclosure to maintain discretion. Chery is deliberating between refurbishing existing facilities or constructing new plants in Italy, with alternative options across Europe also under consideration. 

Notably, the former Nissan plant in Barcelona emerges as a potential site for Chery’s expansion endeavors, indicative of the broader strategic implications of these negotiations.

Additional Players and Government Initiatives:

Beyond Chery, Italy has engaged with other Chinese automakers, including Great Wall Motor, reflecting a concerted effort to diversify partnerships and attract foreign investment. 

The Italian government’s proactive stance underscores its commitment to fostering innovation and bolstering the automotive sector’s global competitiveness.