Italy's government will reallocate some 200 million euros ($222.78 million) in European Union funds it had previously earmarked for a plan by Stellantis to build a battery-making plant in Termoli, officials said on Tuesday.

The government has clashed repeatedly with Stellantis in recent months as the carmaker shifted production to lower-cost sites in other countries.

Public funds originally allocated to ACC will be shifted to other green energy initiatives after Italy says it failed to provide a clear timetable for the development of the plant.

The move of withdrawal of EU fund allocation for Stellantis' gigafactory comes amid tensions between the automobile giant and Italian Prime Minister Giorgia Meloni's right-wing government.