Stellantis has announced plans to begin producing a new line of compact and affordable electric urban vehicles in Italy from 2028, likely including modern interpretations of the iconic Fiat Panda and Citroën 2CV.
The automotive group said the initiative will focus on developing A-segment electric vehicles for Europe, in line with the European Commission’s proposed E-car framework aimed at making production of smaller EVs more practical and commercially viable for manufacturers.
Similar to Japan’s kei car regulations, the EU’s upcoming E-car rules will introduce a new category for electric vehicles built in Europe and measuring under 4.2 metres.
The classification, known as M1E, will allow manufacturers to benefit from “super-credits” tied to their carbon dioxide reduction targets. Although detailed rules for the category have not yet been released, the Commission has previously suggested freezing regulations for ten years to provide greater certainty and reduce constant investment demands on manufacturers.
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Stellantis described the category as a high-potential market segment that could support wider adoption of fully electric vehicles designed for practical daily urban transport. The company said the E-car concept represents a compact, innovative, affordable and fully electric model created in the spirit of European “people’s mobility,” responding to the sharp decline in affordable small cars across Europe.
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Chief Executive Officer Antonio Filosa recently said the absence of vehicles priced below €15,000 is one of the main reasons behind the European automotive industry’s difficulties. Speaking at the Financial Times Future of the Car Summit in London, he said affordability is achievable and compact electric vehicles deserve a dedicated regulatory framework because they generate lower emissions.
Production is expected to start at Stellantis’s Pomigliano plant in southern Italy, which currently builds the Fiat Panda and Alfa Romeo Tonale. The company highlighted the facility’s strong production capacity and long history of manufacturing affordable and popular European cars.
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Autocar previously reported that Fiat was preparing a new entry-level Panda positioned beneath the Grande Panda, based on the STLA City platform used for the Fiat 500. The model is expected to be manufactured in Pomigliano alongside a styled Citroën version designed for the M1E segment.