Stellantis to idle Jeep plant, lay off workers to cut costs for EVs

2016 Jeep Cherokee Sport

Source: Jeep

Detroit – Stella said Friday it plans to indefinitely shut down its Jeep plant in Illinois beginning early next year to cut costs as it invests in electric vehicles.

The transatlantic automaker, formerly known as Fiat Chrysler, has announced that its factories will cease production on February 28. His more than 1,200 workers at the plant that makes the Jeep Cherokee SUV will be put on indefinite layoffs, the company said.

“Our industry has been adversely affected by many factors such as the ongoing COVID-19 pandemic and the global microchip shortage, but the most impactful challenge is related to the electrification of the automotive market. increased costs,” Stellantis said in an emailed statement.

The company described idling as a “difficult but necessary measure.” The company said it was “working to identify other opportunities to reuse the Belvidere facility and has no additional details to share at this time.”

Ray Curry, president of United Auto Workers, said the factory’s idling, especially during this time, was “grossly irrelevant” and “unacceptable.”

“Announcing the closure just weeks after the holidays is also a cruel disregard for the contributions of our members from UAW Locals 1268 and 1761. We will fight back against this announcement,” he said in a statement.

The Illinois factory is running only one of three assembly shifts. It sits sporadically idle during the coronavirus pandemic and ongoing semiconductor chip shortages.

Cherokee sales were down about 61% by the third quarter of the year. That’s less than any other vehicle in the Jeep lineup.

A Stellantis spokesperson echoed the reasons outlined in the statement when asked whether concerns about the recession and collective bargaining with the United Auto Workers next year influenced the company’s decision.

In late 2018, ahead of the 2019 UAW negotiations with the Detroit automaker, general motors announced plans to potentially close several facilities. Only one of the automaker’s major assembly plants – Lordstown Assembly in Ohio – actually closed after negotiations.

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