Four Stellantis Factories in Europe Towards China's Dongfeng: Cassino is Included
Stellantis is evaluating the sale or co-management of four factories in Europe, including the one in Cassino, in the province of Frosinone. According to reports from Bloomberg (source), the group led by Antonio Filosa has initiated contacts with potential partners or buyers to reduce the burden of factories that generate fixed costs without sufficient volumes to cover them. No decision has been made yet, but the dossier is open and the Chinese market is in pole position.
The Four Factories Under Scrutiny
The sites identified by Stellantis are Rennes (France), Madrid (Spain), Cassino (Italy), and a fourth site not yet publicly identified, which some sources place in Germany. The formula under consideration is not necessarily a definitive sale: there is also a model for sharing underutilized production spaces, in exchange for access to Chinese engineering or cross-production agreements. An operation of this type would allow Chinese manufacturers to circumvent EU tariffs by producing directly in the Old Continent, while Stellantis would lighten the fixed costs of the factories.
The main candidate is Dongfeng Motor, a historical Chinese partner of the PSA component, whose managers visited the Rennes and Madrid factories in early April, as well as unspecified sites in Italy and Germany. However, Bloomberg notes that other Chinese manufacturers, including Xiaomi and Xpeng, have also expressed interest, and Stellantis may consider separate agreements with multiple partners rather than an exclusive agreement.
Cassino: Numbers at Historic Low
Cassino is the most troubled site in the entire Italian production network. In the first quarter of 2026, the factory assembled just 2,916 vehicles, representing a -37.4% decline compared to the same period last year, with more days of downtime than actual production. Already in 2025, it had hit a historic low with 19,364 units produced, nearly 30% less than the year before, when in 2017, seven times that number were produced.
The ongoing restructuring does not only concern Cassino: over the next few months, more than 1,000 workers will leave the group through incentivized voluntary exit plans, with Melfi (425), Pomigliano (150), Mirafiori (121), Atessa (302), and Termoli (50). To understand why Stellantis wants to sell or share its European plants, just look at the numbers: in 2025, the group's Italian factories produced a total of 379,000 vehicles, of which only 213,000 were passenger cars, a figure comparable to levels from 1955, compared to over a million in 2004. The causes are multiple: European demand has never recovered to pre-pandemic levels, the choices made by management under Tavares to move mass model production to Morocco, Poland, and Serbia, leaving Western plants without substitute products, and delays in electric platforms that have deprived sites like Cassino of already announced models. Added to this is the Chinese pressure in the mid-range segments, where Peugeot, Citroën, and Fiat were stronger. The result is that half of the Italian employees work reduced hours, and factories built to assemble hundreds of thousands of vehicles annually today produce just a fraction, with unchanged fixed costs against collapsed volumes.
Dongfeng and the Long History with PSA
Dongfeng is not a new interlocutor for Stellantis. The Wuhan company is a historical shareholder of the PSA component of the group and still holds a significant stake. In 2023, the two companies further developed their partnership in China through an asset transfer agreement of 1.71 billion yuan, with Dongfeng acquiring land and facilities from the Dongfeng Peugeot Citroën joint venture in Wuhan and Xiangyang. A precedent that shows how the two companies know how to build complex agreements without necessarily engaging in total sales.
The overall strategy of the group seems outlined: reduce exposure to chronically underutilized European plants and concentrate capital elsewhere. Stellantis effectively manages about twenty assembly sites on the continent, second only to Volkswagen in terms of volume. Furthermore, Leapmotor, the Chinese brand already integrated into Stellantis' portfolio, sold 600,000 vehicles in 2025 and aims for a million this year: a case that shows how collaboration with Asian manufacturers is already an operational reality within the group.
The Precedent: When Dongfeng Negotiated Directly with Rome
Moreover, this is not the first time that Dongfeng and the Italian government have sat down at the same table. Between 2024 and early 2025, the Meloni government had attempted to attract the Wuhan company to open a brand new factory in Italy, as part of the strategy to return to producing a million vehicles annually. The negotiations seemed promising, with Minister Urso expressing confidence in the agreement in April 2024. Then everything stalled. As previously reconstructed, the Chinese government fully controls Dongfeng and had made demands that Rome could not accept: explicit support against EU tariffs on Chinese electric vehicles, a role for Huawei in Italian telecommunications, and formal cooperation on artificial intelligence. Thus, industrial conditions overlapped with geopolitical conditions. The project was frozen in October 2024, after a directive from Beijing inviting domestic manufacturers to slow their expansion in Europe while waiting to understand the evolution of tariffs.
Now the context has changed: instead of building from scratch, Dongfeng could enter Italy through Stellantis' existing facilities, with a decidedly smaller investment and without having to go through a direct agreement with the government. A sidestep that, if taken, would make the political negotiations that proved to be a dead end two years ago unnecessary.
The Government Opens, Unions Observe
The Minister of Enterprises, Adolfo Urso, stated that Italy is "open to foreign investors willing to bet on our country." The government's goal of one million cars produced annually in Italy remains formally unchanged, but the path to achieving it may also involve Chinese capital and technology. Stellantis has limited itself to stating that it "is engaging in discussions with various industry operators worldwide on various topics, as part of its normal activity," without confirming or denying the details that emerged from Bloomberg.
May 21, 2026 is the date circled in red: Stellantis will present its new industrial plan, which should definitively clarify the fate of the European factories and the structure of any partnerships with the Chinese manufacturers.