Gigafactory plans put on ice
Automotive Cells Company (ACC), a key player in Europe’s push to build its own electric vehicle battery supply chain, has dropped plans to build large battery factories in Italy and Germany. The decision comes after electric vehicle demand across Europe grew far more slowly than expected.
Italy’s metalworkers’ union UILM said ACC management confirmed that the proposed gigafactory in Termoli, Italy, will not go ahead. The same fate awaits a planned site in Germany, ending months of uncertainty around both projects, which have been on hold since 2024.
EV demand fails to meet expectations
ACC, which counts Stellantis among its backers, acknowledged that market conditions no longer support restarting the projects. The company said the conditions needed to justify such large investments are simply not in place, as consumer uptake of electric vehicles has fallen short of earlier forecasts.
The cancelled factories were part of a broader European effort to cut dependence on Chinese battery manufacturers. However, ACC has also been reassessing its strategy, including a possible shift toward cheaper battery technologies, further delaying progress and weakening the case for new sites.
Union discussions are now focused on how an orderly shutdown of the Termoli and Kaiserslautern projects might be handled.
Wider impact on Europe’s EV ambitions
ACC is jointly owned by TotalEnergies, Mercedes-Benz, and Stellantis, whose brands include Peugeot, Fiat, and Chrysler. Stellantis recently warned it expects a €22 billion financial hit, admitting it significantly overestimated how quickly drivers would switch to electric cars.
The pullback reflects a wider recalibration across Europe and the US, where governments have started easing strict emissions targets after years of aggressive clean-vehicle policies. Italy, citing uncertainty over timelines, had already withdrawn around €250 million in EU funding originally set aside for the Termoli factory in late 2024.
Together, these moves highlight how slower EV adoption is reshaping Europe’s battery ambitions, forcing companies and governments alike to rethink timelines, investments, and expectations.
