Stellantis has announced the “permanent separation” of 539 employees across its production network in the United States, following a thorough review of its activities in the country. The company communicated this news last week to the affected workers, including those in the less-paid employee category known as temporary workers. The workforce reduction has been implemented immediately. The automotive group clarifies that these reductions are not layoffs, and employees will not have access to additional unemployment benefits.
Stellantis cuts another 539 employees from its plants
“As part of our regular business operations, Stellantis routinely evaluates staff levels at our production facilities to ensure optimal efficiency,” the company said in a statement from spokesperson Jodi Tinson. “This measure aims to enhance the efficiency, productivity, and competitiveness of our plants in the market, aligning with the implementation of our Dare Forward 2030 strategic plan.” Notably, the facilities exempt from this action are Trenton Engine, Dundee Engine, and Toledo Machining in Ohio.
These job cuts follow a series of initiatives by Stellantis in examining its costs while engaging in a transformation to become a technology-oriented mobility company, focusing on electric vehicles which entail higher production costs than their internal combustion counterparts. These actions come after signing a record contract with the UAW union. Earlier this month, the company announced it would not participate in the Chicago Auto Show in February to optimize the use of funds allocated for media. Also, there will be no Super Bowl commercial this year. Last year, the company’s sales in the US saw a 1% decrease, contrasting with growth in the rest of the industry.
The new separations are in addition to the 2,453 temporary layoffs announced at the Mack assembly plant in Detroit, where Stellantis produces the Jeep Grand Cherokee SUVs, and the 1,225 layoffs at the Toledo assembly plant in Ohio, home to the production of the Jeep Wrangler SUV and the mid-sized Gladiator pickup. These figures have come to light from worker adjustment and retraining notification letters sent to respective state authorities. Stellantis had suggested that the total number might be significantly lower, especially in Detroit. The layoffs have been active since February 5th.
It is expected that hundreds of these layoffs will also involve supplemental workers, as indicated in the WARN letters. Before negotiations with the UAW, these workers accounted for about 12% of Stellantis’ hourly workforce, which includes 43,000 U.S. employees, predominantly concentrated in Detroit. In the new contract ratified in November, supplemental workers gained some of the biggest concessions, including a nine-month transition period until the expiration of the full-time contract, an initial wage of $21 per hour, and the opportunity to participate in company profits and additional benefits. In November, Stellantis also announced that it had offered exit incentives to 6,400 white-collar workers in the U.S. The company has not shared how many employees have accepted the offer.