By Giuseppe Fonte
ROME (Reuters) -Italy is open to buying a stake in carmaker Stellantis, Industry Minister Adolfo Urso said on Thursday, as he set out plans to provide 950 million euros ($1 billion) in subsidies this year to help drivers switch to cleaner cars.
The new incentive scheme follows a clash between Italy's rightist government and Fiat-owner Stellantis, led by Chief Executive Carlos Tavares, over production levels in the country.
Urso said that Stellantis had committed to boosting production in Italy back to the million vehicle level, a figure last hit in 2017. The total last year was around 750,000.
He went on to suggest that Italy could match the French government by taking a stake in the carmaker, whose other brands include Peugeot and Jeep.
"If Tavares maintains that Italy needs to do the same as France, which has boosted its active investment in Stellantis, then they can ask. We can discuss it together," Urso told reporters on Thursday.
Stellantis declined to comment.
France holds a 6% stake in Stellantis, the group formed in 2021 through the merger of Fiat Chrysler and France's PSA Group. Italy's Agnelli family is the single largest investor in Stellantis through its Exor vehicle.
Prime Minister Giorgia Meloni said last week that Stellantis - which also has major businesses in France and America - had sometimes acted against the national interest.
As an opposition politician, Urso had in the past called for state lender Cassa Depositi e Prestiti (CDP) to buy a stake in Stellantis.
Last June, Stellantis Chairman John Elkann said his company did not need to add the Italian state to its shareholders.
The group has said the one million output target in Italy depends on several factors, including Italy spending more on incentives, the development of an EV recharging network and lower energy costs.
SUBSIDY SCHEME
The measures announced on Thursday will help Italy to renew what is one of the oldest car fleets in Europe.
Rome will provide up to 13,750 euros in subsidies for the lowest earners to help them buy a new fully-electric vehicle costing up to 35,000 euros excluding VAT. Part of the subsidy is linked to scrapping an existing polluting combustion-engine car.
The same income group can also get a subsidy of up to 10,000 euros for a new plug-in hybrid costing up to 45,000 euros.
State-of-the art combustion engine vehicles will qualify for subsidies as well, though they will be smaller.
The incentives, which had been expected for months, are more generous than those they replace, which amounted to up to 5,000 euros for electric vehicles.
The outlay is part of a wider multi-year programme, worth over 8 billion euros, that Italy announced in 2022 to support its car industry.
Urso said Rome could channel public resources from next year directly to new production plants in Italy should incentives continue to mainly fund cars made in foreign factories.
Davide Mele, head of corporate affairs for Stellantis Italy, said the package should help support the domestic car industry.
"We make cars based on consumer demand ... That's why it is fundamental to stimulate demand with cars at affordable prices," he told the meeting with government officials and unions. ($1 = 0.9260 euros)