Stellantis plans to idle operations at an assembly plant in Belvidere, Illinois effective Feb. 28, citing the rising cost of electric vehicle production as the primary factor in its decision.
“Our industry has been adversely affected by a multitude of factors like the ongoing COVID-19 pandemic and the global microchip shortage, but the most impactful challenge is the increasing cost related to the electrification of the automotive market,” the Netherlands-based automaker said in an emailed statement.
Stellantis has taken several steps to stabilize and optimize production at its North American facilities to both lower cost and preserve quality, a spokesperson said. Halting production at Belvidere is the next in a series of corrective actions to optimize its operations.
The automaker, which employs 1,350 workers and assembles Jeep Cherokees at the Belvidere facility, said the decision will result in indefinite layoffs expected to exceed six months. However, the company added it would try to place employees in full-time positions elsewhere as they become available.
Since the action may constitute job loss, Stellantis issued Worker Adjustment and Retraining Notifications to both hourly and salaried workers last week.
“We are all deeply angered by Stellantis’ s decision to idle the Belvidere Assembly plant without a plan for future product,” United Auto Workers Vice President and Director of the Stellantis Department Cindy Estrada said in a statement.
“There are many vehicle platforms imported from other countries that could be built in Belvidere with skill and quality by UAW members at Belvidere. The transition to electrification also creates opportunities for new product,” Estrada said. “Companies like Stellantis receive billions in government incentives to transition to clean energy. It is an insult to all taxpayers that they are not investing that money back into our communities.”
Just last year, Stellantis announced plans to invest over 30 billion euros through 2025 to meet its target of making over 70% of its European sales and 40% U.S. sales low emission vehicles by 2030.
Stellantis said it would explore ways to repurpose the Illinois plant but has no additional details to share at this time.
