The Evolution of Sustainability: The Automotive Supply Chain Opportunity in Southern Italy

This Special Issue titled “Assessment of Socio-Economic Sustainability and Resilience after COVID-19” aims to propose the positive relationship between sustainability and resilience across multiple sectors.

COVID-19 is not the only problem that needs to be addressed at this time, as the environment has clearly shown signs of weakness. Urban centers are responsible for 80% of the world’s GDP, but they also produce 70% of the world’s CO₂ emissions and consume about 70% of the world’s energy [1]. Moreover, it should be added that socio-economic inequality, unemployment, extreme poverty, unsustainable production and consumption patterns and environmental degradation demand urgent responses [2,3].

Europe has launched an ambitious plan towards the European Green Deal and, to this end, the Next Generation EU is a response to the socio-economic crisis caused by the pandemic. Some authors pointed out that it is necessary to develop the concept of the “sustainable hand”, which is the set of actions that determine the social optimum within a market. This concept looks at the long term and can be implemented by virtue of new paradigms of social norms, models developed and implemented to help govern social interactions towards a sustainable future [4].

The manufacturing system highlights how innovation and sustainability can coexist, such that technological sustainability can be defined as a possible fourth dimension of sustainable development [5]. Similarly, it is also necessary to ensure a proper combination of sustainability and resilience [6]. This Editorial focuses on Italy, which will have a fundamental role within the Next Generation EU, since it is the recipient of about one third of the total available budget. In particular, it is necessary to overcome a significant problem that is the territorial disparity, in which the northern regions tend to show more performing results than the southern ones. In particular, these regions show potential for sustainability [7]. The adoption of digital technologies can enable competitiveness, but everything is linked to an effective collaboration between the different parties [8].

In addition, the analysis focuses on the automotive industry that presents very significant numbers in the European landscape through direct and indirect jobs amounting to employment for 13.8 million Europeans, which corresponds to about 6.1% of total employment. The European Union is among the world’s largest producers of motor vehicles and the sector represents the largest private investor in research and development [9]. The performance of companies inferred from sustainability reports shows positive, but also negative performances. In particular, changes in organizational structures and appropriate policies have played an important role [10]. Sustainable manufacturing and green human resources are identified as critical success factors in the automotive sector [11].

The pandemic also affected the automotive sector, leading to a contraction in sales, however some companies have been able to absorb the contraction better. In particular, at the Sevel plant located in Val di Sangro (located in the Abruzzo Region (South Italy)) new hires were made in July 2020 and January 2021 [12]. Sevel was born in 1981 as the joint venture between Fiat and Peugeot, now united in Stellantis (Stellantis is a multinational company incorporated under Dutch law, born from the merger between the PSA and Fiat Chrysler Automobiles groups) and is considered to be the most important European production hub for light commercial vehicles. The company produces about 300 thousand vehicles per year. In particular, the Ducato is one of the most popular models globally and, with the shortening of production chains caused by the pandemic in the last year and a half, its production performance has increased significantly. In fact, the risks connected to production chains that are too geographically extensive are increasingly perceived by companies, just as the lack of production capacity in some areas (masks or vaccines themselves, for example) is perceived by public opinion to be an element of weakness of the entire system.

Sevel has always been defined as a model company where the production rate was so high that it required the use of people on loan from other plants in the group and staff on ‘staff-leasing’, i.e., on a temporary basis. The company therefore proved itself to be resilient to the pandemic, but the shortage of Bosch Abs control units from Malaysia has led to a slowing in the pace of work, with a reduction in production of commercial vehicles. This slowing down will lead to a reduction in work shifts (from 18 h to 15 h), for a company in which work was done in shifts from Monday to Saturday and Sunday, including line maintenance operations. This reduction in shifts has had an impact on the reduction of personnel, which will involve laying off workers from other factories in the group and temporary workers whose contracts will not be renewed. In addition, another important element related to the company was the opening of a plant in Gliwice (Poland) in 2019. This was a choice dictated by reasons of industrial policy, since the production saturation of the Abruzzo plant of Sevel prevented it from responding to the new production levels [12]. In addition, the CEO of Stellantis, Carlos Tavares, announced that in the Termoli plant (located in the Molise Region (Southern Italy), which is about 70 km from Sevel) there will be one of the five gigafactories for the production of batteries of the Stellantis group. This decision will allow for the preservation of several jobs in the Termoli plant.

Discussion and Policy Implications

The pandemic has highlighted a sense of instability, with the closures of many businesses prompting significant changes that will need to be examined over time. One reflection we have come to is that the key role many businesses have taken on, the security systems already in place at these facilities, have enabled them not to close. However, lockdowns have also led to contractions in demand. Light vehicle production was not affected, but a long supply chain is responsible for the current crisis. Accordingly, the system has been proven to be resilient. Human resources are the fulcrum on which to develop a sustainable society. This is an area rich in students and potential, as highlighted by Luca De Meo, the Chairman of Renault [12]. The idea is to create a pole of sustainable automotive innovation in the Abruzzo and Molise cluster, using, first, all of the human resources acquired in recent years in the group’s plants and then proceeding to a generational change. A challenge that must go beyond the automotive sector alone but must include all other sustainable spheres (e.g., production of renewable energy, energy efficiency, and re-use of materials) and digital; a team game that must involve all the surrounding industries, which represent a significant share of the local economy. Too often, short-sightedness leads to the simple replacement of people, forgetting the added value that they have acquired over time, regardless of the organizational position held. Within the school of human relations, Argyris pointed out that we must bear in mind that the people employed by the organization have their own personality. The individual evolves and seeks to achieve their own balances and is not only a subject of action, but also a subject of organizational learning. A necessary mutual balancing between personality and organization was therefore identified. The objective that is, therefore, posed in this work is twofold: (i) how to make this cluster globally competitive and (ii) how to create a virtuous model of industry-tourism coexistence. On this last aspect, Sergio Marchionne (Former CEO of the Fiat-Chrysler Automobiles group and in 2011 defined among the 100 most influential people in the world by Time magazine’s ranking) focused on 9 July 2013, asking in his last speech in Abruzzo at Sevel, for investment in roads, development of commercial ports, implementation of broadband in industrial districts and also the design of tourism as a strategic asset.

The concept of a sustainable hand is based on making people part of the change, in which there are not only rights but also tasks, all of which are for the good of society as a whole. The binomial industry-tourism can call for appropriate lifestyles (e.g., diet, physical activity, stress reduction) which are possible in the territories examined, but sustainability must be achieved, i.e., leading companies and the entire supply chain must be able to compete on a global level. The challenge is by no means simple and requires the contribution of everyone in the formulation of ideas and strategies that can protect all the parties involved. This is a challenge in which everyone is called upon to make proposals, but also to take steps backwards. It is a matter of developing a stable and dynamic relationship between internal and external organization. Within this cluster, it is necessary to combine production with research and development in order to develop synergies and attract talent. In this context, the support that can be guaranteed by the universities in the area becomes fundamental.

The establishment of a true Abruzzo-Molise motor valley (specific automotive cluster, which in fact already exists because other 2500 people work in the Termoli plant today), would consolidate an industrial quadrilateral which, along with the Pomigliano D’Arco (Campania) and Melfi (Basilicata) plants, represents one of the most interesting production poles in Europe for the Stellantis Group.

The crisis caused by Covid-19 is confirming the centrality of integrated logistics, in light of the inevitable redefinition of industrial supply chains that will become increasingly proximate.

Logistics and industry, in fact, are the same thing, and it is no coincidence that Amazon has invested precisely in the South of Abruzzo, creating one of the most important logistics poles in Southern Europe.

In today’s economy, industrial policy must favor processes of personnel training, technological and organizational innovation, reducing bureaucratic obstacles and making services available for efficient logistics.

Just the integrated logistics is a further factor of aggregation and development of the automotive quadrilateral of the Centre-South, which can be further strengthened by the establishment in Abruzzo of a Special Economic Zone (SEZ) - see Cianciotta [13], whose positive outcome will be determined by the value of integrated logistics and the quality of services provided.

The Special Economic Zone of Puglia is already in force and also includes Molise, while that of Abruzzo must wait a few more months because the Decree of appointment by the Government of the Commissioner Mauro Miccio is being registered at the Court of Auditors.

Our proposal, in order to increase the attractiveness of the entire Adriatic strip from Abruzzo to Puglia, is to work towards the creation of a single SEZ.

In fact, establishing a single Special Economic Zone of the Southern Adriatic would mean having several industrial clusters in strategic sectors for the relaunch of the economy (automotive and aerospace, for example), as well as having an integrated system of commercial port infrastructures (Vasto, Ortona, Brindisi and Bari), which would be particularly advantageous, both in terms of negotiations with multinationals already operating within this large area, and in terms of attracting investment.

If to the inevitable relapses on the territories, we add also that the Marche (to whose inside of the Harbor Authority figure also the Abruzzo) and the same Molise are regions in transition, this means that within a communitarian program, these regions will assign approximately 6% more of their resources to Italy, and it is estimated that, to these two regions, from 10% to 20% of greater contributions can be attributed.

The Marche region itself is also working on obtaining a SEZ, which will have different criteria from those established with Government Decree No. 91 in 2017 that constituted the SEZs for the regions of Southern Italy, but which is still a novelty in terms of measures for attracting investment.

It is here, then, that the central-southern Adriatic would find itself united with a measure that could determine and increase its potential, especially in a strategic moment favorable to the resumption of maritime trade on the Mediterranean, which has returned to play an important role after the doubling of the Suez Canal and with the redefinition of the routes due to the pandemic (on the Mediterranean’s contribution to economic development, see the monographic issue of Limes [14].).

Finally, sustainability can promote a redistribution of people, since it is necessary to reduce the transfer of many young people to densely populated cities and, likewise, induce a reverse path.

This can happen if two conditions are met: (i) attractive living conditions and (ii) present working conditions. It is indeed necessary to revitalize some territories and it is necessary to do this for future generations; for those who want to be protagonists in the social life giving a direct contribution. This society cannot remain deaf to this request because sustainability is the greatest opportunity for putting young people at the center of political action.