Stellantis, the corporate behind Fiat, Dodge, and Jeep, has introduced that it plans to halt certainly one of its crops and lay off 1,200 employees come February. Its reasoning? Stress from COVID-19, certain, together with a splash of chip shortages — however primarily all these electrical autos it has to make.
The manufacturing unit in query is one which builds Jeep Cherokees in Illinois, and the information comes because the automaker is gearing up for union negotiations. Whereas United Auto Employees argues that “the transition to electrification additionally creates alternatives” on the plant, an unnamed Stellantis spokesperson instructed CNBC and The Wall Road Journal that it was as an alternative the explanation for the halt. “Essentially the most impactful problem is the rising value associated to the electrification of the automotive market,” the corporate claims, including that it’s exploring different makes use of for the plant, and that it’s looking for jobs for the employees it’s shedding.
Stellantis is spending billions on EVs
However let’s again up for a second — one of many world’s largest automakers is saying it has to shutter a plant indefinitely due to how a lot electrification is costing? That’s a daring declare, particularly because it’s coming from an organization I’d contemplate to be in distant third within the massive three American automakers’ race to maneuver their lineups from fuel to batteries. It additionally doesn’t assist that Stellantis has been promising fairly a couple of electrified Jeeps, and it’s exhausting to see why this manufacturing unit couldn’t play a task in making these autos, a minimum of certainly one of which is due out subsequent 12 months (and lots of of which have been very tough to search out).
This isn’t to say that Stellantis isn’t spending massive on EVs — it’s promised to separate an as much as $3 billion invoice with Samsung for a battery manufacturing unit in Indiana, and it’s investing $4.1 billion in an analogous facility situated in Canada, this time with LG. However that’s not an unthinkably giant funding in comparison with a few of its friends: GM is spending a whopping $7 billion on certainly one of its three EV battery factories within the works, Honda’s serving to construct a $4.4 billion plant in Ohio (and spending $700 million extra to retool current amenities), and Ford has introduced it’s constructing three EV-related places with a price ticket of over $11.4 billion.
Ford’s an attention-grabbing comparability, although, as a result of it additionally went by means of a current spherical of layoffs, chopping round 3,000 jobs. No prizes for guessing one of many excuses it gave staff; “We now have a possibility to guide this thrilling new period of linked and electrical autos,” learn a memo from CEO Jim Farley and chairman Invoice Ford. “Constructing this future requires altering and reshaping just about all points of the best way we’ve operated for greater than a century.” That, in fact, meant chopping jobs.
It’s too early to say whether or not EVs are going to develop into a typical scapegoat if the auto trade retains finishing up layoffs, however now we’ve a minimum of two firms making an attempt to color hundreds of peoples’ livelihoods as the price of the long run. (EV-native firms like Tesla or Rivian, which have additionally had their very own large rounds of layoffs this 12 months, don’t have that luxurious.)
