Although southern European countries have not yet resolved their economic woes, the slumping euro currency, falling gasoline prices and labor strategies have lifted the region’s auto industry export quotas.
On the sidelines of the Geneva International Motor Show, taking place as we speak in Switzerland, auto industry executives have warned that the situation should not be treated with overoptimism – saying the situation must first pass its temporary level in places such as Italy, Spain and Portugal, where the great recession led to a six-year slump that yielded the lowest deliveries in around two decades. With sales now constantly increasing, some experts are confident that automakers can make good use of the region’s production capacity – lifting output at underused factories or even move models from other plants to southern Europe. Italy, for example, is still fighting its way to recovery after the longest post-war recession and statistics office Istat predicts gross domestic product will grow just 0.1 percent in the first quarter – the first surge since mid-2011.
Fiat Chrysler Automobiles, for example, has moved to give hundreds of workers in Italy permanent jobs and made pledges for new hires as new models – including the first from the slowly rejuvenating Alfa Romeo brand – are scheduled to go into production later on this year. Others are also lifting the output of models in the region: Ford said last month it was implementing the final portion of a 2.3 billion euro investment to expand its Spanish operations and lift annual capacity to 450,000 units. Last September Opel also began production of the Opel Mokka subcompact SUV in Europe after finishing up a 210 million euro upgrade of its Zaragoza, Spain, factory.