Stellantis Korea, which sells Jeep, Peugeot, Citroen, and DS Automobiles vehicles in the country, will introduce a redundancy program to address the challenging economic environment. The Korean unit of the global automotive group led by CEO Carlos Tavares announced: “Due to rapid changes in market conditions, it has been necessary for us to be more agile in response to market demand, so we are restructuring our organization and workforce.” However, the latest decision has been attributed to slowing sales in the Korean market.
Stellantis: possible workforce reduction in South Korea due to low sales
According to the local automotive market tracker Car Is You, the number of newly registered Jeep vehicles in Korea during the third quarter was 3,400, down 35 percent year-on-year. The number of newly registered Peugeot cars was 1,347. As part of their efforts to address the issue, Stellantis Korea recently reduced the price of the Peugeot 3008 SUV by 3.3 million won ($2,400). The price of the Jeep Grand Cherokee Limited SUV has also dropped from 85.5 million won in the Korean market to 76.9 million won. However, these efforts do not seem to have been effective enough to prevent the impending workforce reduction at Stellantis Korea.
The company has declined to disclose the number of employees who will be leaving and the amount of compensation to be offered. “I heard that employees leaving the company will receive money equivalent to several months of their salary,” wrote a Stellantis Korea worker on Blind, an anonymous chat app for verified employees. The automaker’s headquarters has also laid off workers in other countries. In April, the company offered voluntary buyouts to 33,500 US employees, citing plans to streamline operations. “We are facing an incredibly harsh scenario. On the one hand, we should compete with Chinese rivals who have costs that are 25 percent lower. On the other hand, we are told to accept a 40 percent increase in costs due to the electrification of cars,” said Carlos Tavares, CEO of Stellantis.