Stellantis’s subsidiary, Fiat Chrysler Automobiles Serbia (FCA) in Kragujevac, is facing significant production challenges similar to its parent company. Despite promises, the factory has not yet reached the planned output of 500 electric and hybrid Fiat Grande Pandas per day. Since May, production has hovered around 300 cars daily, but recent organizational and logistical issues have reduced that number to just over 200 cars per day, split between two shifts. The planned introduction of a third shift has been postponed from July to the second half of August due to part shortages and a lack of trained workers.
A major bottleneck is the shortage of labor. While the contract between Stellantis and the Serbian government requires around 1,500 employees, the factory needs between 2,500 and 3,000 workers for full three-shift operation. Currently, there are only 1,700 to 2,000 employees. Low wages—around 70,000 dinars monthly for production workers—are cited as a key reason for the shortage. Despite additional bonuses and allowances, many workers consider the pay insufficient for the demanding factory work.
The demographic decline in the Šumadija region, where the factory is located, adds to the labor shortage. Birth rates have dropped, and many young people are emigrating, fueling speculation that missing workers may need to be recruited from countries such as Nepal, Sri Lanka, India, and Turkey. FCA has acknowledged employing dozens of Italians but has not yet hired workers from Asian countries.
Production delays are also linked to the company’s shifting strategy, increasingly emphasizing hybrid vehicles due to greater demand. Currently, electric Panda customers can receive their cars faster than those ordering hybrids, which have a longer waiting period. Competition from other Fiat models, such as the electric and hybrid Fiat 600 produced in Poland, is growing, with customers increasingly opting for the latter due to better availability.
The factory faces logistical issues after Stellantis eliminated the central warehouse, which previously stored all parts before distribution to assembly lines. Now, parts are delivered directly to production lines, making the system vulnerable to delays when any part is missing. This has led to frequent production stoppages and significant truck congestion on-site.
Despite these problems, Fiat’s CEO remains optimistic, projecting annual production of up to 300,000 units of all Grand Panda versions across Kragujevac and other plants in Algeria and Brazil. Plans include producing manual gearbox versions without hybrid drives in Kragujevac, although the impact of increasing fines for excess carbon emissions on these plans remains uncertain.
The factory’s struggles have also impacted Serbia’s economic growth forecasts. Earlier expectations that FCA’s production would contribute 0.5 percent to Serbia’s GDP growth in 2025 have not materialized, with actual GDP growth significantly below initial projections.
