Italy cuts $223 million funding for EV battery plant

Italy's government will reallocate around 200 million euros (USD 223 million) in EU funds to a Stellantis and Mercedes-Benz EV battery project that has faced delays due to a slowdown in EV demand in Europe. Funds initially allocated to Automotive Cells Company (ACC), whose shareholders include the two automakers Stellantis and Mercedes-Benz, will be relocated to other green energy initiatives after ACC failed to provide a clear timetable for the plant’s development, Italy’s Industry Minister Adolfo Urso said, according to a Bloomberg report. ACC had laid out plans to build three battery factories in Europe with a total investment of €7 billion (USD 7.

8 billion). But it paused preparatory work this year on a site in Termoli, Italy; and halted construction in Kaiserslautern, Germany. CEO Yann Vincent told Bloomberg that ACC will resume discussions over possible funding plans with the Italian government in the first half of 2025.



Meanwhile, Stellantis will continue building motors at the Termoli plant until 2028 to soften the impact from the battery factory delay, a company official said. Italy’s government has clashed with Stellantis in recent months as the automaker shifted production to lower-cost sites in other countries amid a slowdown in EV demand. Production at Stellantis’s Mirafiori plant in Turin dropped 63% in the first half following lukewarm demand for the electric Fiat 500.

Last week, the group said it planned to halt production of the vehicle again because of a lack of orders in Europe..