The Italian automotive industry is grappling with severe declines as it enters 2025, with production figures plummeting sharply. According to data from ISTAT, the production of vehicles has decreased by 25.3% compared to January of the previous year, highlighting persistent struggles across the sector.
Specifically, the manufacture of motor vehicles (Ateco Code 29.1) recorded a staggering 37% decline, and the production of cars has fallen dramatically by 63.4%, resulting in just 10,800 vehicles produced last month. Meanwhile, the manufacture of bodies for motor vehicles, trailers, and semi-trailers (Ateco Code 29.2) is the exception, showing a slight increase of 7%. On the other hand, the manufacture of parts and accessories for vehicles and engines (Ateco Code 29.3) saw a decline of 15.4%. This troubling trend casts doubt on the industry's future, which is already marked by weak performance.
January's figures reflect broader issues facing the Italian industrial sector, with the general index of industrial production falling by 0.6% year-on-year. This downward trend is corroborated by industry turnover data, which revealed declines of 1.4% for December 2024 and 3.4% for the entire year.
Gianmarco Giorda, the General Director of ANFIA (Italian Automotive Industry Association), expressed considerable concern about the current state of the industry. He stated, "The automotive industry continues to suffer, with production declining sharply. The action plan presented by the European Commission does not provide adequate responses to support the sector's competitiveness," stressing the urgent need for effective interventions to stabilize the industry.
Looking at trade dynamics, exports of Italian cars between January and November 2024 reached 16.4 billion euros, whereas imports soared to 33.7 billion euros. The United States remains the largest market for Italian automotive exports at 19%, followed by Germany at 15.4% and France at 11.3%. When it came to component exports, the sector generated 23 billion euros, resulting in a positive trade balance of 6.4 billion euros, underscoring the importance of components to Italy's automotive sector.
Despite these figures, concerns over the viability of Italian automotive production remain. The turnover for the automotive sector dropped 14.7% overall for 2024, with domestic turnover decreasing by 16.9% and foreign turnover down 12.6%. A grim spotlight is cast on parts and accessories, which experienced an 18% decline by the close of 2024.
The situation is exacerbated by the aging vehicle fleet, with the average age of vehicles on the road now standing at 12.5 years. This not only presents challenges for vehicle owners but also raises environmental concerns due to higher emissions from older vehicles.
Industry leaders are calling for a strategic revival plan to reverse these continuing declines. Giorda called for concrete measures aimed at rebalancing energy costs with major competitors like the United States and China, noting the importance of sustainability and safety measures as well as the modernization of the current vehicle fleet.
With the automotive sector facing heightened pressure from multiple fronts, stakeholders stress the necessity for structured investment and planning. The hope remains for the Italian automotive industry to rebound and retain its competitive edge. Without decisive action and support, the challenges seem poised to deepen, threatening to impact not just the industry but also the broader economy.
While the Italian automotive industry has faced significant challenges, the potential for recovery is reliant on cohesive strategies and action from both the government and industry stakeholders. The plea for attention resonates through calls for immediate action to safeguard the future, ensuring the industry can adapt and evolve amid changing market dynamics.
