Towards a fully electric vehicle production by 2035: economic implications for Italy’s automotive sector through an input-output approach

Edoardo Alberti, Leonardo Piccini, Tommaso Ferraresi and Renato Paniccià

International Journal of Automotive Technology and Management Vol. 26, No. 3 | Published Online: August 28, 2026, pp. 228-266 – https://doi.org/10.1504/IJATM.2026.155989

Abstract

This study assesses the economic and employment impacts of the complete electrification of the automotive industry in Italy, in the context of the European fit for 55 packages. We employed European input-output tables and used an inter-country input-output model to develop counterfactual scenarios that include the relocation of inputs supply chains for the Italian automotive production, a fully electric vehicle production, projections and change in demand due to a lower degree of market penetration and a reduction in the growth rate of vehicle registrations.
Results show that electrification stimulates growth in electronics and vehicle assembly and reduces demand for metalworking, rubber and plastic supplies and some tertiary services.
There is a significant risk of erosion of the national supply chain and loss of domestic content to European hubs and Asian suppliers if local capabilities are not developed. Industrial and demand policies are strongly needed to mitigate these impacts.

Keywords: automotive electrification, electric vehicle adoption, energy transition, input-output analysis, fit for 55 packages, Italian electric vehicle market, Italy.

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